Accounting exercises
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hho9e_p15_23a_eip_stud.xlsxP15-23A
| Accounting, 9e | ||||||
| P15-23A | Preparing common-size income statements | |||||
| LO 2 [20-30 minutes] | ||||||
| Students please fill-in areas that are shaded | ||||||
| Student Name | ||||||
| Course Name | ||||||
| Student ID: | ||||||
| Date: | ||||||
| The McConnell Department Stores, Inc., chief executive officer (CEO) has asked you | ||||||
| to compare the company’s profit performance and financial position with the average | ||||||
| for the industry. The CEO has given you the company’s income statement and balance | ||||||
| sheet, as well as the industry average data for retailers. | ||||||
| Data from Exercise 15-13 presented here for your convenience. | ||||||
| MCCONNELL DEPARTMENT STORES, INC. | ||||||
| Income Statement Compared with Industry Average | ||||||
| Year Ended December 31, 2012 | ||||||
| McConnell | Industry Average | |||||
| Net sales revenue | $ 778,000 | 100.0% | ||||
| Cost of goods sold | 522,816 | 65.8% | ||||
| Gross profit | $ 255,184 | 34.2% | ||||
| Operating expenses | 161,046 | 19.7% | ||||
| Operating income | 94,138 | 14.5% | ||||
| Other expenses | 4,668 | 0.4% | ||||
| Net income | $ 89,470 | 14.1% | ||||
| MCCONNELL DEPARTMENT STORES, INC. | ||||||
| Balance Sheet Compared with Industry Average | ||||||
| December 31, 2012 | ||||||
| McConnell | Industry Average | |||||
| Current assets | $ 325,440 | 70.9% | ||||
| Fixed assets, net | 120,960 | 23.6% | ||||
| Intangible assets, net | 8,640 | 0.8% | ||||
| Other assets | 24,960 | 4.7% | ||||
| Total assets | $ 480,000 | 100.0% | ||||
| Current liabilities | $ 222,720 | 48.1% | ||||
| Long-term liabilities | 107,520 | 16.6% | ||||
| Stockholders’ equity | 149,760 | 35.3% | ||||
| Total liabilities and stockholders’ equity | $ 480,000 | 100.0% | ||||
| Requirements | ||||||
| 1. | Prepare a vertical analysis for McConnell for both its income statement and balance | |||||
| sheet. | ||||||
| Test Your Knowledge | ||||||
| P15-23A | ||||||
| Req. 1 | ||||||
| MCCONNELL DEPARTMENT STORES, INC. | ||||||
| Income Statement | ||||||
| Year Ended December 31, 2012 | ||||||
| Amount | Percent of Total | |||||
| Net sales revenue | $ 778,000 | 100.0% | ||||
| Cost of goods sold | 522,816 | |||||
| Gross profit | $ 255,184 | |||||
| Operating expenses | 161,046 | |||||
| Operating income | 94,138 | |||||
| Other expenses | 4,668 | |||||
| Net income | $ 89,470 | |||||
| MCCONNELL DEPARTMENT STORES, INC. | ||||||
| Balance Sheet | ||||||
| December 31, 2012 | ||||||
| McConnell | Industry Average | |||||
| Current assets | $ 325,440 | 67.8% | ||||
| Fixed assets, net | 120,960 | |||||
| Intangible assets, net | 8,640 | |||||
| Other assets | 24,960 | |||||
| Total assets | $ 480,000 | |||||
| Current liabilities | $ 222,720 | |||||
| Long-term liabilities | 107,520 | |||||
| Stockholders’ equity | 149,760 | |||||
| Total liabilities and stockholders’ equity | $ 480,000 | |||||
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