Motion Used Auto Sales asked for your help in comparing the company€™s profit performance and financial position with the average for the auto sales industry. The proprietor has given you the company€™s income statement and balance sheet as well as the industry average data for retailers of used autos.

Requirements
1. Prepare a two-column, common-size income statement and a two-column, common-size balance sheet for Motion Used Auto Sales. The first column of each statement should present Motion Used Auto Sales€™ common-size statement and the second column should show the industry averages.
2. For the profitability analysis, examine Motion Used Auto Sales€™ (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 Motion€™s profit performance better or worse than the industry average?
3. For the analysis of financial position, examine Motion Used Auto Sales€™ (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 Motion Used Auto Sales€™ financial position better or worse than the industryaverage?

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Motion Used Auto Sales Income Statement Compared with Industry Average Year Ended December 31, 2012 INDUSTRY AVERAGE MOTION S952,800 608,700 344,100 100.0% 62.1% 37.9% Net Sales Cost of Goods Sold Gross Profit Operating Expenses Operating Income Other Expenses Net Income 113,500 6,200 S107,300 10.1% 0.4% 97% Mation Used Auto Sales Balance Sheet Compared with Industry Average December 31, 2012 INDUSTRY AVERAGE MOTION Current Assets Fixed Assets, Net Intangible Assets, Net Other Assets Total Assets S478,700 160,600 7.400 42,900 $689,600 70.9% 23.6% 0.8% 47% 100.0% Current Liabilities Long-Term Liabilities Stockholders' Equity Total Liabilities and Stockholders Equity S294,800 118,500 276,300 48.1% 16.6% 353%