AutoSave OOFF - COE . ACCO012_Assignment6 ~ Home Insert Draw Page Layout Formulas Data Review View Acrobat Tell me Share Comments Default Ruler Formula Bar Zoom 90% Split Hide H Keep Exit New Options Normal Page Break Page C Custom Zoom to New Arrange Freeze Freeze Freeze First Switch View Record Use Relative Preview Layout Views Gridlines Headings 100 Zoom to 100% Selection Window All Panes Top Row Column Unhide Windows Macros Macro References V37 4 X V fx D G H K L M N 0 P R S U V w AA AB Patel's Fabrics Ltd Comparative Income Statements Required: 2016 $ 2016% 2017 $ 2017% 2018 $ 2018% 1. Prepare a horizontal analysis for all 3 years. Use %, not dollars. What significant changes do you see? Sales 599, 100 538,900 508,100 COGS 291,000 259,200 234,300 2. Prepare common-size financial statements for all 3 years. What significant changes do you see? Gross margin 308,100 279,700 73,800 9 Operating expenses 106,200 104,600 04,100 3.Assess Patel's liquidity by using liquidity ratios. Is the company's position improving or deteriorating? Explain your answer. 0 Operating income 201,900 175,100 69,700 4. Assess Pippin's profitability by using profitability ratios. For ratios that require average balances 11 Interest expense 11,200 10,500 11,900 calculate them for 2017 & 2018 only. Assess's Patel's profitability using these ratios. 12 Income before taxes 190,70 64,600 157,800 5. How does the stock market view Pippin's performance over thees three years? Explain the 13 Income taxes (40%) 76,280 65,840 63,120 basis for your answer. 14 Net income 1 14,420 38,760 94,680 . After you have completed the above analysis, identify what you consider to be the three most significant 15 weaknesses in Patel's performance. 16 17 Patel's Fabrics Ltd In order to pass this assignment, you must complete all parts of the assignment. 18 Comparative Balance Sheets 19 20 2016 $ 2016% 2017 $ 2017% 2018 $ 2018% 21 Assets 22 Cash 32,000 25,800 20,50 23 A/R (net) 126,860 127,000 94,300 24 Inventory 60,000 80,700 56,000 25 Prepaid expenses 11,000 10,00 4,600 26 Total current assets 229,860 243,500 75,400 27 Capital assets (net) 668,900 576,000 540,30 28 Total assets 898,760 819,500 15,700 29 30 Liabilities & Shareholders' Equity 31 Accounts payable 53,120 31,200 79,100 32 Accrued expenses 1,000 12,240 41,700 33 Total current liabilities 64,120 93,440 20,80 34 Long-term debt 170,000 160,000 50,000 35 Total liabilities 234, 120 253,440 70,800 37 Common stock ($0.50 par value) 6,000 6,000 5,000 38 Additional paid in capital 99,000 99,000 62,000 Retained earnings 659,640 461,060 377,900 40 Total equity 664,640 566,060 444,900 41 Total liabilities & equity 898,760 819,500 15,700 42 Closing Stock Price $ 35.00 $ 30.00 44 45 46 Sheet1 + + 90%
