Question
chocolate treats ltd. and coffee bars inc. are both specialty food chains. The two companies reported these figures, in thousands: chocolate treats ltd. statement of
chocolate treats ltd. and coffee bars inc. are both specialty food chains. The two companies reported these figures, in thousands:
chocolate treats ltd.
statement of operations
fiscal year
(thousands). 2020. 2019
revenue:
net sales $543 $708
gross and expenses:
cost of goods sold $475 598
GENERAL AND ADMINISTRATIVE 68 55
EXPENSES
CHOCOLATE TREATS LTD
BALANCE SHEET
JANUARY 31,
(THOUSANDS) 2020 2019
ASSETS:
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $17 $28
RECEIVABLES 27 30
INVENTORIES 24 29
COFFE BARS INC.
STATEMENT OF EARNINGS
FISCAL YEAR
(THOUSANDS) 2020 2019
NET SALES $7,787 $6,369
COST OF GOODS SOLD 3,179 $2,605
SELLING,GENERAL AND ADMINISTRATIVE EXPESES 2,948 2,363
COFFEE BARS INC.
BALANCE SHEET
YEAR END
(THOUSANDS) 2020 2019
ASSETS:
CURRENT ASSETS:
CASH AND TEMPORARY INVESTMENTS $313 $174
RECEIVABLES, NET 224 191
INVENTORIES 636 546
USE GROSS PROFIT PERCENTAGE AND INVENTORY TURNOVER TO EVALUATE TWO COMPANIES
REQUIREMENT
1. COMPUTE THE GROSS PROFIT PERCENTAGE AND THE RATE OF INVENTORY TURNOVER FOR CHOCOLATES TREATS AND FOR COFFEE BARS FOR 2020.
2. BASED ON THIS STATISTICS, WHICH COMPANY BOOKS MORE PROFITABLE? WHY? WHAT OTHER EXPENSES CATEGORY SHOIULD WE CONSIDER IN EVALUATING THESE TWO COMPANIES?
(thousands)
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