Question

please explain the steps.. I need parts f & g

Presented here are the comparative balance sheets of Hames Inc. at December 31, 2020 and 2019. Sales for the year ended December 31, 2020, totaled $690,000. HAMES INC. Balance Sheets December 31, 2020 and 2019 2020 2019 $ 23,000 78,000 103,000 $ 204,000 50,000 125,000 ( 65,000) $ 314,000 $ 19,000 72,000 99,000 $ 190,000 40,000 110,000 (60,000) $ 280,000 Assets Cash Accounts receivable Merchandise inventory Total current assets Land Plant and equipment Less: Accumulated depreciation Total assets Liabilities Short-term debt Accounts payable Other accrued liabilities Total current liabilities Long-term debt Total liabilities Stockholders' Equity Common stock, no par, 100,000 shares authorized 40,000 and 25,000 shares issued, respectively Retained earnings: Beginning balance Net income for the year Dividends for the year Ending balance Total stockholders' equity Total liabilities and stockholders' equity $ 18,000 65,600 20,000 $ 103,600 22,000 $ 125,600 $ 17,000 75,000 18,000 $ 110,000 30,000 $ 140,000 $ 74,000 $ 59,000 $ 81,000 53,400 (20,000) $ 114,400 $ 188,400 $ 314,000 $ 85,000 1,000 (5,000) $ 81,000 $ 140,000 $ 280,000

Answer 1

a	ROI	15.68%
b	ROE	28.34%
c	Working Capital	$        100,400
d	Current Ratio	1.97 Times
e	Acid Test Ratio	0.97 Times
f	ROI	16.04%
	ROE	28.34%
	Working Capital	$        100,400
	Current Ratio	2.13 times
g	ROI	15.68%
	ROE	28.34%
	Working Capital	$        100,400
	Current Ratio	1.97 Times

Working Notes :

1. ROI :

				Scenario 2				Scenario 3
Average Operating Assets				Average Operating Assets				Average Operating Assets
	2020	2019			2020	2019			2020	2019
Total Current Assets	$        204,000	$ 190,000		Total Current Assets	$     189,000	$ 190,000		Total Current Assets	$ 204,000	$ 190,000
Plant and Equipment	$        125,000	$ 110,000		Plant and Equipment	$     125,000	$ 110,000		Plant and Equipment	$ 125,000	$ 110,000
Long Term Debt	$          22,000	$    30,000		Long Term Debt	$        22,000	$    30,000		Long Term Debt	$    22,000	$    30,000
Total	$        351,000	$ 330,000		Total	$     336,000	$ 330,000		Total	$ 351,000	$ 330,000
Average Operating Assets	$        340,500			Average Operating Assets	$     333,000			Average Operating Assets	$ 340,500
Net Operating Income	$          53,400			Net Operating Income	$        53,400			Net Operating Income	$    53,400
ROI	15.68%			ROI	16.04%			ROI	15.68%

ROE :

				Scenario 2				Scenario 3
Stockholders Equity	$        188,400			Stockholders Equity	$     188,400			Stockholders Equity	$ 188,400
Net Operating Income	$          53,400			Net Operating Income	$        53,400			Net Operating Income	$    53,400
ROE	28.34%			ROE	28.34%			ROE	28.34%

Working Capital :

3	Working Capital
					Scenario 2				Scenario 3
		2020				2020				2020
	Total Current Assets	$        204,000			Total Current Assets	$     189,000			Total Current Assets	$ 204,000
	Total Current Liabilities	$        103,600			Total Current Liabilities	$        88,600			Total Current Liabilities	$ 103,600
	Working Capital	$        100,400				$     100,400				$ 100,400

4.

4	Current Ratio
					Scenario 2				Scenario 3
		2020				2020				2020
	Total Current Assets	$        204,000			Total Current Assets	$     189,000			Total Current Assets	$ 204,000
	Total Current Liabilities	$        103,600			Total Current Liabilities	$        88,600			Total Current Liabilities	$ 103,600
	Current Ratio	1.97				2.13				1.97

5. Acid Test Ratio

5	Acid Test Ratio
		2020
	Cash	$          23,000
	Account Recievables	$          78,000
		$        101,000
	Current Liabilities	$        103,600
	Acid Test Ratio	0.97