Answer:
a. Current ration = Total current assets / Total current liabilities
Current year = 8,600,030 / 7,340,300 = 1.17
Prior year = 8,420,100 / 7,216,000 = 1.167
b. Receivables turnover = Sales / Average Account receivables
=$13,560,300 / (4,590,000 + 3,804,000 / 2)
= $13,560,300 / $4,197,000
= 3.23 times
c. Days to collect = 365 / Receivables times
= 365 / 3.23
= 113 days
d. Inventory turnover ration = Cost of goods sold / Average Inventory
= $8,908,695 / ($924,360 + $1,235,440 / 2)
= $8,908,695 / $1.079,990
= 8.25 times
e. Days to sell = 365 / Inventory turnover
= 365 / 8.25
= 44.24 days