Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

52e statements profitability and with the industry P18-39 Top managers of Tilt Windows Inc., a specialty fabricating company, have asked for your help in comparing

image text in transcribed
52e statements profitability and with the industry P18-39 Top managers of Tilt Windows Inc., a specialty fabricating company, have asked for your help in comparing the company's profit performance and financial position with the average for the window-making industry. The accountant has given you the company's income statement and balance sheet, and also the average data for their industry (amounts in millions): TILT WINDOWS INC. Income Statement For the Year Ended December 31, 2020 Tilt Windows Industry Average Net sales $29.2 100.0% Cost of goods sold 17,6 65.9 Gross margin 11,6 341 Operating expenses 8.4 281 Operating Income 3.2 6.0 Other expenses 0.2 0.4 Net Income $ 3.0 5.6% Industry Average 66.6% 323 TILT WINDOWS INC. Balance Sheet December 31, 2020 Tilt Windows Current assets $10.4 Property, plant, equip.net 8.0 Other assets 0.2 Total assets $18.6 Current liabilities $ 6.2 Long-term liabilities 5.2 Shareholders' equity 7.2 $18.6 Total liabilities and shareholdersequity 1.1 100.0% 35,6% 19.0 45.4 100.0 Required 1. Prepare a two-column common-size income statement and a two-column com mon-size balance sheet for Tilt Windows Inc. The first column of each statement should present Tilt Windows Inc.'s common-size statement, and the second col- umn should show the industry averages. Round all answers to one decimal place. 2. For the profitability analysis, compare Tilt Windows Inc.'s (a) ratio of gross mar gin to net sales, (b) ratio of operating income (loss) to net sales, and (c) ratio of net income (loss) to net sales with the industry averages. Ils Tilt Windows Inc.'s profit performance better or worse than the average for the industry? 3. For the analysis of financial position, compare Tilt Windows Inc.'s (a) ratio of cur rent assets to total assets and (b) ratio of shareholders' equity to total assets with the industry averages. Is Tilt Windows Inc.'s financial position better or work than the average for the industry? alysis of Accounting Information

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Tools For Business Decision Making

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso

6th Edition

111919167X, 9781119191674

Students also viewed these Accounting questions