Top managers of Bull's Eye Archery Company have asked your help in comparing the company's profit performance and financial position with the average for the sporting goods industry. The accountant has given you the company's income statement and balance sheet and also the following data for the sporting goods industry.

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1. Prepare a two-column common-size income statement and a two-column common-size balance sheet for Bull's Eye. The first column of each statement should present Bull's Eye's common-size statement, and the second column should show the industry averages.
2. For the profitability analysis, compute Bull's Eye's

(a) ratio of gross profit to net sales,

(b) ratio of operating income (loss) to net sales, and

(c) ratio of net income (loss) to net sales. Compare these figures with the industry averages. Is Bull's Eye's profit performance better or worse than average for the industry?
3. For the analysis of financial position, compute Bull's Eye's

(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 Bull's Eye's financial position better or worse than average for the industry?

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BULL'S EYE ARCHERY INCOME STATEMENT COMPARED WITH INDUSTRY AVERAGE YEAR ENDED DECEMBER 31, 19X3 BULL'S EYE ARCHERY BALANCE SHEET COMPARED WITH INDUSTRY AVERAGE DECEMBER 31, 19X3 Bull's Eye Industry Bull's Eye Industry Average Average Net sales $957,000 100.0% Current assets. $448,000 74.4% Cost of goods sold. 653,000 65.9 Fixed assets, net. 127,000 20.0 Gross profit Operating expenses. Operating income Other expenses. Net income.... 304,000 34.1 Intangible assets, net. 42,000 0.6 257,000 28.1 Other assets 13,000 5.0 47,000 6.0 Total.... $630,000 100.0% 2,000 0.4 Current liabilities. $246,000 35.6% $ 45,000 5.6% Long-term liabilities 144,000 19.0 Stockholders' equity.. 240,000 45.4 Total... $630,000 100.0%