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Forecasted Balance Sheet as of December 31, 2020
Cash		$ 72,000
Accounts receivables		$ 639,000				Accounts and notes payable	$ 432,000
Inventories		$ 994,000				Accruals	$ 170,000
Total current assets		$1,705,000				Total current liabilities	$ 602,000
Land and building		$ 338,000				Long-term debt	$ 604,290
Machinery		$ 132,000				Common stock	$ 775,000
Other fixed assets		$ 61,000				Retained earnings	$ 254,710
Total assets		$2,236,000				Total liabilities and equity	$2,236,000
Forecasted Income Statement for 2020
Sales		$6,390,000
Cost of goods sold		$5,580,000				Per-Share Data
Gross operating profit		$ 810,000				EPS	$
General admin & selling expenses		$ 236,320				DPS	$
Depreciation		$ 159,000				P/E Ratio
Misc. Expenses		$ 34,000				Market price	$ 50.00
Earnings before Taxes		$ 380,680				Number of shares outstanding	20,000
Taxes		$ 126,306
Net Income		$ 254,374
	King, Inc.		Financial Ratios
	Quick Ratio		1.81
	Current Ratio		2.83
	Inventory Turnover		6.42
	Debt-to-Equity (D/E)		1.17
	Fixed Asset Turnover		12.03
	Total Asset Turnover		2.85
	Return on Assets		0.11
	Return on Equity		0.24
	Total Debt Ratio		0.53
	Profit Margin on Sales		0.04
	P/E Ratio		3.93

Based on Kings ratios, describe strengths and/or weaknesses in the companys ongoing operations, investment, and financing decisions. Quick Ratio versus Current Ratio? Inventory Turnover, Fixed Asset Turnover versus Total Asset Turnover, Return on Equity versus Return on Assets. Use the DuPont model to calculate the ROE. Are there any red flags? Is PM too low? Is TAT too low? Is Debt-to-Equity (D/E) too high? Remember that the Equity Multiplier equals 1+D/E as well as TA/TE.

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