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need help with this problem.. not sure if my answers are right for business transaction 1, so if you could help me with all parts that would be amazing... thanks!

12. The effect of transactions on ratios AaAa You've been asked to tutor Logan, a finance student who doesn't feel comfortable about his understanding of the relationship between a company's business activities, its financial accounts, and the company's financial ratios. To better appreciate these relationships, you've created the following exercises for Logan to complete. The purpose of these exercises is to help Logan (1) understand the effect of business transactions on finandial statement such as balance sheet and income statement accounts and (2) how these changes in the numerators and denominators of financial ratios affect the ratios' values. However, before using these exercises in your tutoring session later today, you'll want to run the calculations on the folowing two business transactions, to verify the accuracy of your answers. two business transactions, to verify the accuracy of your answers To provide a consistent frame of reference for the company's financial statements and ration. assume that the folowing balance sheet and income statement reflect the company's pretransaction condition and performance. Wellington Industries's Pretransaction Wellington Industries's Pretransaction Statement of Financial Condition $20,000 20,000 10,000 50,000 Statement of Financial Performance Sales Less: Cost of goods sold Gross profit Less: operating expenses Operating profit (EBIT $5,000,000 2,000,000 3,000,000 600,000 2,400,000 33,000 $15,000 Accounts payable Cash Marketable securities Accounts receivable Inventory Prepaid expenses 10,000 Wages payable 470.000 Taxes payable 500,000 Notes payable S,000 otal current liabilities100,000 e 500,000Less: Interest expense? Total current assets 1,000,000 Long-term debt Earnings before taxes (EBT)2,367,000 600,000 150,000 Total liabiliths Less: Tax expense 828,450 $1,538,550 Gross plant and equipment 1,500,000 Common stock Accumulated depreciation0 Net plant and equipment 500,000 Capital paid in excess of par 350,000 900,000 000,000 Retained eamings Total equity 1/400,000 cost of goods sold equals 40% of sales. 2Interest expense equals 6% of the combined notes payable and long-term debt balances. $2,000,000 Total debt and equity-$2,000,000 | Total assets

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