PROBLEM II Financial Ratios (Adapted from MAS Reviewer by Aljohn Lee) Lyn merchandising has 1,000,000 common shares with each share priced at P8. In 2017, the company declared dividends of PO.10 per share. The balance sheet at the end of 2017 showed approximately the same amounts as that at the end of 2016. The financial statements of Lyn Merchandising are as follows: Lyn Merchandising, Income Statement for 2017 (In thousands) Sales P4,700 Cost of Goods Sold (2,300) Gross Profit P2,400 Operating Expenses: Depreciation P320 Others 1,23 (1,550) EBIT P850 (150) P700 (280) Interest Expense Earnings before tax Income Tax NET INCOME P420 Lyn Merchandising, Balance Sheet at December 31, 2017 (In Thousands) ASSETS LIABILITIES and SHE Cash Accounts Payable Accrued expenses Total Current Liab. Long-term debt P220 P190 Accounts Rec. 440 180 Inventory 410 Total Current Ass. P1,070 5,600 (2,100) P370 1,960 1,810 PPE Common stocks Accum. Dep. Total Assets Retained earnings 430 P4.570 Total Liab and SHE P4.570 REQUIRED: (Round answers to two decimal places)

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