Discuss the financial health of Pet World.

You have been asked to assess the financial standing of Pet World, a national pet store operation. Below is information from Pet World’s balance sheet and income statement. Use the following information to calculate the following ratios: Current Ratio, Acid Ratio, Cash Ratio, Debt Ratio, Times Interest Earned, Cash Coverage Ratio, Inventory Turnover, Profit Margin Ratio, Return on Assets, Return on Equity, Earnings Per Share, and Price to Earnings Ratio. All work and formulas must be shown. Round to 2 decimal places.After you have calculated the ratios, describe the financial health of Pet World in a 3-page report using at least 10 of the ratios as evidence. In the report, explain what your chosen ratio tells you about Pet World’s finances and why it is significant in assessing the company’s financial health. Present your answers and calculations for all the ratios at the end of the report (these calculations do not count toward the 2 pages for the report).************ Balance Sheet************ASSETS:Current Assets:Cash: 3,372,000Short term investments 980,000Net receivables 2,425,000Inventory: 3,200,000TOTAL CURRENT ASSETS: 9,977,000Long term investments 1,500,000Property, plant, equipment 6,420,000Goodwill 3,450,000TOTAL LONG TERM ASSETS 11,370,000TOTAL ASSETS: 21,347,000LIABILITIES:Current Liabilities:Accounts Payable: 1,980,750Short term debt 1,100,000TOTAL CURRENT LIABILITIES 3,080,750Long term debt 4,465,000TOTAL LONG TERM DEBT 4,465,000TOTAL LIABILITIES: 7,545,750STOCKHOLDER’S EQUITY:Common Stock 2,200,000 (44,000 shares outstanding at $50 per share)Retained Earnings 11,601,250TOTAL STOCK EQUITY 13,801,250TOTAL LIABILITIES & OE 21,347,000*******Income Statement*********Sales Revenue 18,330,000Cost of Goods Sold 12,755,000Gross Profit 5,575,000Operating Expense:Research and Development 1,400,000Marketing 750,000Payroll 2,450,000Operating Income 975,000Interest Income 35,000EBIT (Earning before interest & taxes)1,010,000Interest expense 75,000Income before taxes 935,000Taxes 35% 327,250Net income from operations 607,750