Financial data of Cost Cutter Retailers, Inc. for the year ending $2021$ and $2020$

Items $20212020$

Sales $$2,200,000$ $$1,900,000$

Cash $100,00070,000$

Selling$/$Admin Expenses $420,000500,000$

Retained Earnings $600,000500,000$

Long$-$term debt $120,00070,000$

Cost of goods sold $1,300,0001,100,000$

Depreciation $150,000130,000$

Long$-$term investments $70,00080,000$

Gross Fixed Assets $2,400,0002,000,000$

Interest Expenses $90,00070,000$

Shares outstanding $($$$1$ par$)120,000120,000$

Market Price of stock $3\mathrm{.}54$

Accounts Receivable $350,000300,000$

Accounts payable $440,000250,000$

Inventory $430,000410,000$

Notes Payable $400,000400,000$

Accumulated Depreciation $1,150,0001,000,000$

Accruals $50,00070,000$

Tax Rate $33\mathrm{.}34\%33\mathrm{.}34\%$

$($round your actual dollar tax to the nearest thousands$)$

Preferred Stock $($$$100$ par value$)900$ shares $900$ shares

Capital Paid in excess of Par $410,000410,000$

Prepaid Expenses $30,00050,000$

Preferred Stock Dividend paid $10,0000\mathrm{.}00$

Common Stock Dividend paid $50,0000\mathrm{.}00$

Instructions:

As a group, complete the following activities using the financial information above:

Part $1$: Financial Statements

A$.$ Prepare the income statement for $2021.$ Include statement of retained earnings for $2021.$

B$.$ Prepare the balance sheet for $2021$ and $2020$

C$.$ Prepare Common$-$Size financial statements for the income statement and balance sheet for $2021.$

D$.$ Prepare Statement of Cash Flows for $2021$

Based on your financial statements

$(,$ calculate the following ratios for the two years. Show all your calculations in good form. Show your formulas. If you use excel, each calculation needs to show the excel formula.

Comments on the trend of each ratio by comparing $2022$ to $2021$ ratios. In addition to commenting on the trends of the ratios, explain the meaning of each ratio.

Please organize and group your ratios, calculations, and explanations as follows:

Liquidity ratios $($calculations and explanations$/$comments$)$

Current Ratio

Quick Ratio

Asset Management ratios $($calculations and explanations$/$comments$)$

Inventory Turnover

Accounts Receivable Turnover

Fixed Asset Turnover

Total Asset Turnover

Debt Management ratios $($calculations and explanations$/$comments$)$

Debt Ratio

Times Interest Earned $(1$ year only$)$

Profitability ratios $($calculations and explanations$/$comments$)$

Profit Margin $(1$ year only$)$

Return on Assets

Return on Equity $($using DuPont$)$

$(1$ year only$)$

Market Value ratios $($calculations and explanations$/$comments$)$

Price$-$to Earnings Ratio

$(1$ year only$)$

What is DuPont Analysis? As a manager, how would you use Dupont Analysis in the overall evaluation of the financial performance of a firm? Support your comments with appropriate in$-$text citations and references.

Find industry ratios for $2022$ like the ones you calculated. Compare the industry ratios you found to the ratios you calculated. Based on the industry average, how is Cost Cutter Retailers doing financially? Please note that this is a retail company like Walmart. The industry average you use should be from the retail sector.