Reference no: EM13862609

Prepare the Common size statements using Excel ( Make sure you use the functions). Save as an Excel document.

Problem 1

1. Using the following balance sheet, prepare a common size balance sheet:

Assets				Liabilities and stockholders' equity
Current assets				Current liabilities
	Cash	4			Accounts payable	28
	Short-term investments	9			Current portion of long-term debt	12
	Accounts receivable	32		Total current liabilities		40
	Inventory	41		Long-term liabilities
	Prepaid expenses	2			Long-term debt	48
	Deferred taxes, current	7		Total liabilities		88
Total current assets		95
Long-term assets				Stockholders' equity
	Property & equipment	53			Common stock and PIC	51
	Goodwill	12			Retained earnings	30
	Long-term investments	8
	Other assets	1		Total stockholders' equity		81
Total assets		169		Total liabilities and equity		169

Problem 2

Using the following information prepare a common size income statement:

Net sales                                           $9,500

Cost of goods sold                               5,900

Gross profit                                        $3,600

General and administrative expenses       1,250

Selling expenses                                 920

Operating profit                                  $1,430

Income tax expense                           460

Net profit                                         $970