Comparative income statement data for Manitou Ltd. and Muskoka Ltd., two competitors, are shown below for the year ended June 30, 2024. 

Instructions 

a. Using vertical analysis, calculate the percentage of the base amount of the income statement for each company. 

b. Calculate the gross profit margin, profit margin, asset turnover, return on assets, and return on equity ratios for 2024 for each company. 

c. Using the information calculated in parts (a) and (b), compare the profitability of each company. 

d. Is your comparison in part (c) an intracompany comparison or an intercompany comparison? Explain. 

How is your assessment of profitability affected by the differing sizes of the two companies, if at all? Explain.

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Net sales Cost of goods sold Gross profit Operating expenses Profit from operations Rental income Profit before income tax Income tax expense Profit for the year Additional information: Average total assets Average total shareholders' equity Manitou $360,000 200,000 160,000 60,000 100,000 12,000 112,000 22,400 $ 89,600 $457,500 204,800 Muskoka $1,400,000 720,000 680,000 272,000 408,000 24,000 432,000 95,040 $ 336,960 $1,725,000 743,480