Prepare a common-size income statement and balance sheet

Assignment Help Accounting Basics

Reference no: EM13588538

Decide (a) whether Sanfields ability to pay debts and to sell inventory improved or deteriorated during 2011 and (b) whether the investment attractiveness of its common stock appears to have increased or decreased.

Russel Department stores INC.

Income Statement
Russell Industry Average
Net Sales 77,000 100.0%
COGS 523,698 65.8
Gross Profit 253,302 34.2
Operating ex. 162,393 19.7
operating income 90,909 14.5
other expense 7,770 0.4
Net Income 83,139 14.1

Russel Dep Balance Sheet

Russell Industry average

Current Assets 330,750 70.9%
fixed assets,net 123,480 23.6
Intangible Assets,net 9,800 0.8
Other assets 25,970 4.7
Total assets 490,000 100.0
Current liab 227,360 48.1
Long term liab 111,720 16.6
Stockholders equity 150,920 35.3
Total liabilities and 490,000 100.0

stock holders

Requirements

R1. Prepare a common-size income statement and balance sheet for Russell. The first column of each statement should present Russell's common-size statement, and the second column, the industry averages.

R2. For the profitability analysis, compute Russell's (a) ratio of gross profit to net sales, (b) ratio of operating income to net sales, and (c) ratio of net income to net sales. Compare these figures with the industry averages. Is Russell's profit performance better or worse than the industry average?

R3. For the analysis of financial position, compute Russell's (a) ratio of current assets to total assets and (b) ratio of stockholders' equity to total assets. Compare these ratios with the industry averages. Is Russell's financial position better or worse than the industry averages?

Reference no: EM13588538

Questions Cloud

Diekow productions manufactured and sold 1000 products at : diekow productions manufactured and sold 1000 products at 11000 each during the past year. at the beginning of the year

A magnetic field is oriented at an angle of 37 degrees to : a magnetic field is oriented at an angle of 37 degrees to the normal of a rectangular area 4.5 cm by 7.0 cm. if the

Kerry company has 1050 shares of 100 par value 8 preferred : kerry company has 1050 shares of 100 par value 8 preferred stock and 9500 shares of 10 par value common stock

Bieber company has excess capacity on two machines 24 hours : bieber company has excess capacity on two machines 24 hours on machine 105 and 16 hours on machine 107. to use this

Prepare a common-size income statement and balance sheet : decide a whether sanfields ability to pay debts and to sell inventory improved or deteriorated during 2011 and b

Baloney company has offered to sell janice foeld 10000 : janice foeld company manufactures part z for use in its production cycle.the costs per unit for 10000 units of part z

Your monthly electric bill is probably expressed in : your monthly electric bill is probably expressed in kilowatt-hours kwh a unit of energy delivered by the flow of 1 kw

A 120-v motor has mechanical power output of 250 hp it is : a 120-v motor has mechanical power output of 2.50 hp. it is 90 efficient in converting power that it takes in by

Compute the current break-even point in units and compare : mary willis is the advertising manager for bargain shoe store. she is currently working on a major promotional

User Account

All Pages