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1. Measures of liquidity, The ability of a company to make itsperiodic interest payments and repay the face amount of debt atmaturity.Solvency, and The ability of a firm to generateearnings.Profitability

   The comparative financial statements of Marshall Inc. are asfollows. The market price of Marshall common stock was $ 65 onDecember 31, 20Y2.

   Marshall Inc.
   Comparative Retained EarningsStatement
   For the Years Ended December 31, 20Y2 and20Y1
   			20Y2		20Y1
   Retained earnings, January 1			$ 2,468,925		$ 2,076,275
   Net income			554,800		425,300
   Total			$3,023,725		$ 2,501,575
   Dividends:
   	On preferred stock		$ 7,000		$ 7,000
   	On common stock		25,650		25,650
   		Total dividends	$ 32,650		$ 32,650
   Retained earnings, December 31			$ 2,991,075		$ 2,468,925

   Marshall Inc.
   Comparative Income Statement
   For the Years Ended December 31, 20Y2 and20Y1
   	20Y2		20Y1
   Sales	$ 2,941,900		$ 2,710,540
   Cost of goods sold	1,083,320		996,650
   Gross profit	$ 1,858,580		$ 1,713,890
   Selling expenses	$ 577,590		$ 728,340
   Administrative expenses	492,020		427,750
   Total operating expenses	$1,069,610		$1,156,090
   Income from operations	$ 788,970		$ 557,800
   Other revenue	41,530		35,600
   	$ 830,500		$ 593,400
   Other expense (interest)	200,000		110,400
   Income before income tax	$ 630,500		$ 483,000
   Income tax expense	75,700		57,700
   Net income	$ 554,800		$ 425,300

   Marshall Inc.
   Comparative Balance Sheet
   December 31, 20Y2 and 20Y1
   			20Y2		20Y1
   Assets
   Current assets
   	Cash		$ 453,090		$ 593,470
   	Marketable securities		685,760		983,470
   	Accounts receivable (net)		584,000		547,500
   	Inventories		438,000		335,800
   	Prepaid expenses		85,730		118,690
   		Total current assets	$ 2,246,580		$ 2,578,930
   Long-term investments			1,813,355		786,135
   Property, plant, and equipment (net)			3,250,000		2,925,000
   Total assets			$ 7,309,935		$ 6,290,065
   Liabilities
   Current liabilities			$ 748,860		$ 1,371,140
   Long-term liabilities:
   	Mortgage note payable, 8%		$ 1,120,000		$ 0
   	Bonds payable, 8%		1,380,000		1,380,000
   		Total long-term liabilities	$ 2,500,000		$ 1,380,000
   Total liabilities			$ 3,248,860		$ 2,751,140
   Stockholders' Equity
   Preferred $0.70 stock, $50 par			$ 500,000		$ 500,000
   Common stock, $10 par			570,000		570,000
   Retained earnings			2,991,075		2,468,925
   Total stockholders' equity			$ 4,061,075		$ 3,538,925
   Total liabilities and stockholders' equity			$ 7,309,935		$ 6,290,065

   Required:

   Determine the following measures for 20Y2, rounding to onedecimal place, except for dollar amounts, which should be roundedto the nearest cent. Use the rounded answer of the requirement forsubsequent requirement, if required. Assume 365 days a year.

   1. The excess of the current assets of abusiness over its current liabilities.Working capital	$
   2. A financial ratio that is computed bydividing current assets by current liabilities.Current ratio
   3. A financial ratio that measures the abilityto pay current liabilities with quick assets (cash, temporaryinvestments, accounts receivable), computed as quick assets dividedby current liabilities.Quick ratio
   4. The relationship between sales and accountsreceivable, computed by dividing the sales by the average netaccounts receivable; measures how frequently during the year theaccounts receivable are being converted to cash.Accounts receivableturnover
   5. The relationship between sales and accountsreceivable, computed by dividing the average accounts receivable bythe average daily sales.Number of days' sales in receivables		days
   6. The relationship between the volume ofgoods sold and inventory, computed by dividing the cost of goodssold by the average inventory.Inventory turnover
   7. The relationship between the volume ofsales and inventory, computed by dividing average inventory by theaverage daily cost of goods sold.Number of days' sales ininventory		days
   8. A solvency ratio that measures how muchfixed assets a company has to support its long-term debt.Ratio offixed assets to long-term liabilities
   9. A comprehensive leverage ratio thatmeasures the relationship of the claims of creditors tostockholders' equity, calculated as total liabilities divided bytotal stockholders' equity.Ratio of liabilities to stockholders'equity
   10. A ratio that measures the risk thatinterest payments will not be made if earnings decrease, calculatedas income before income tax and interest expense divided byinterest expense.Times interest earned
   11. Ratio that measures how effectively abusiness uses its assets to generate revenues, computed as salesdivided by average total assets.Asset turnover
   12. A measure of the profitability of assets,without regard to the equity of creditors and stockholders in theassets.Return on total assets		%
   13. A measure of profitability computed bydividing net income by average total stockholders’ equity.Return onstockholders’ equity		%
   14. A measure of profitability computed bydividing net income, reduced by preferred dividend requirements, byaverage common stockholders' equity.Return on common stockholders’equity		%
   15. The profitability ratio of net incomeavailable to common shareholders to the number of common sharesoutstanding.Earnings per share on common stock	$
   16. The ratio of the market price per share ofcommon stock, at a specific date, to the annual earnings pershare.Price-earnings ratio
   17. Measures the extent to which earnings arebeing distributed to common shareholders.Dividends per share ofcommon stock	$
   18. A ratio, computed by dividing the annualdividends paid per share of common stock by the market price pershare at a specific date, that indicates the rate of return tostockholders in terms of cash dividend distributions.Dividendyield