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P4.10 A restaurant has the following statistical information calculated from its financial statements for the past three years: Year 0006 Year 0007 Year 0008 Current ratio Credit card turnover ratio Accounts receivable turnover Food inventory turnover ratio Total liabilities to total equity Return on stockholders' equity Annual sales revenue 1.24:1 91 times 14 times 38 times 1.94:1 7.7% S880,000 1.18:1 93 times 24 times 44 times 2.52:1 9.6% $882,500 1.05:1 98 times 31 times 48 times 2.95:1 9.9% $872,300 W Using this information, answer each of the following questions and ex- plain your answer. A simple yes, no, more, less, or maybe won't do! A comment is required in each case. a. Are current assets in relation to current liabilities increasing or decreasing? b. Is the restaurant becoming more or less efficient in the collection of its credit card receivables? C. Is the restaurant becoming more or less efficient in the collection of its accounts receivable? d. Over the three-year period, has more or less money been tied up in food inventory? e. With the stockholders' viewpoint in mind, is profitability improving or not improving? f. If the restaurant needed to borrow capital through long-term debt, would it be easier to find a lender now than three years ago? g. Has the restaurant been using leverage to the advantage of the stock- holders over the three-year period

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