Ivanhoe department stores located in Midtown Metropolis. during the past several years net income has been declining because suburban shopping centers have been attracting business away from city areas. At the end of the companies fiscal year on November 30, 2025 these accounts appeared in its adjustable trial balance.

1. Prepare a retained earnings Statement. (list items that increase retained earnings first)

2. Prepare a classified balance sheet. (list current assets in order of liquidity)

3. Calculate the profit margin and the gross margin profit rate (round answers to one decimal place)

4. Revised net income:

Revised profit margin:

Revised gross porfit rate:

Question 9 of 9 11 5 Liabilities and Stockholders' Equity Prepare a retained earnings statement. (List items that increase retained earnings first.) Prepare a classified balance sheet. (List current assets in order of liquidity.) Calculate the profit margin and the gross profit rate. (Round answers to 1 decimal place, eg. 15.2\%) Profit margin Gross profit rate % % eTextbook and Media List of Accounts The vice president of marketing and the director of human resources have developed a proposal whereby the company would compensate the sales force on a strictly commission basis. Given the increased incentive, they expect net sales to increase by 15%. As a result, they estimate that gross profit will increase by $33,015 and expenses by $45,085. Compute the expected new net income. (Hint: You do not need to prepare an income statement.) Then, compute the revised profit margin and gross profit rate. Revised net income Revised profit margin (Round to 1 decimal place, eg. 15.2\%) Revised gross profit rate (Round to 1 decimal place, eg. 15.2\%) Additional data: Notes payable are due in 2029. Question 9 of 9 Accounts Payable Accounts Receivable Accumulated Depreciation-Equipment Cash Common Stock Cost of Goods Sold Freight-Out Equipment Depreciation Expense Dividends Gain on Disposal of Plant Assets Income Tax Expense Insurance Expense Interest Expense Inventory Notes Payable Prepaid Insurance Advertising Expense $21,200 13,700 54,400 6,400 28,000 475,700 5,880 145.000 10,900 9,600 1,600 8.000 7,200 4,000 20.900 34,800 4.800 26,800