Chapter 14, Problem 8AP

a.

To determine

Compute the ratios for Incorporation HE:

1. Inventory turnover.

2. Accounts receivable turnover.

3. Total operating expenses.

4. Gross profit percentage.

5. Return on average stockholders’ equity.

6. Return on average assets.

b.

To determine

Explain whether the loan should be obtained from the viewpoint of stockholders.