Performance 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 Performance Used Auto Sales. The first column of each statement should present Performance Used Auto Sales€™ common-size state- ment and the second column should show the industry averages.
2. For the profitability analysis, examine Performance Used Auto Sales€™
(a) Ratio of gross profit to net sales,
(b) Ratio of operating income to net sales,
(c) Ratio of net income to net sales. Compare these figures with the industry averages. Is Performance Used Auto Sales€™ profit performance better or worse than the industry average?
3. For the analysis of financial position, examine Performance Used Auto Sales€™
(a) Ratio of current assets to total assets
(b) Ratio of stockholders€™ equity to total assets. Compare these ratios with the industry averages. Is Performance Used Auto Sales€™ financial position better or worse than the industryaverage?

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Performance Used Auto Sales Income Statement Compared with Industry Average Year Ended December 31, 2012 INDUSTRY PERFORMANCEAVERAGE Net Sales Cost of Goods Sold Gross Profit Operating Expenses Operating Income Other Expenses Net Income 100.0% 62.1% 37.9% 27.8% 10.1% 0.4% 9.7% 576,800 80,700 5,600 S 75,100 Performance Used Auto Sales Balance Sheet Compared with Industry Average December 31, 2012 INDUSTRY PERFORMANCEAVERAGE Current Assets Fixed Assets, Net Intangible Assets, Net Other Assets Total Assets $287,100 96,800 2.900 19,900 70.9% 23.6% 0.8% 47% S199,800 76,300 130,600 S406,700 48.1% 16.6% Current Liabilities Long-Term Liabilities Stockholders' Equity Total Liabilities and Stockholders' Equity 100.0%