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Unformatted text preview: 2005 Ratio–06 Ratio05 Current assets $174,369 $124,369 2.43 1.83 Current liabilities 71,616 68,001 b. Accounts receivable turnover ratio 2006 Ratio  06 Net credit sales $712,855 23.57 Avg. net AR 30,245 c. Inventory turnover ratio 2006 Ratio  06 Cost of goods sold $483,463 4.38 Avg. inventory 110,315 d. Debt to equity ratio 2006 2005 Ratio–06 Ratio05 Total liabilities $83,932 $103,201 0.69 0.52 Total SE 121,851 198,935 e. Return on equity ratio 2006 Ratio  06 Net income $11,953 0.07 Avg. Common SE 160,393 Do any of these ratios suggest problems for the company? The ratios indicate that the company has acceptable liquidity and solvency. However, the proportion of debt financing has increased, increasing risk....
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 Spring '08
 Muslu
 Balance Sheet, assets Current liabilities, $159,000, $83,932 121,851

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