Problem 2
On the following page, I have attached PG Companys Consolidated Statements of Earnings for the 3 fiscal years ending June 30, 2019.
Required:Using the attached earnings statement, for each period presented,
- Compute the gross margin %
Note: Gross margin % = [(Net sales Cost of products sold)/Net sales] x 100
- Compute the net profit margin on sales %
Note: Net profit margin % = (Net earnings attributable to PG/Net sales) x 100
- Considering the 3-year trend for a. and b. above, provide a brief comment about the companys performance for:
- Gross margin % and
- Net profit margin %.
Consolidated Balance Sheets 4.2395 6,048 4.951 2.569 9281 4.686 1,335 588 Amounts in millions: As o ne 10 Assets CURRENT ASSETS Cash and cash equivalents Available for sale investment securities Accounts receivable INVENTORIES Materials and supplies Work in process Finished goods Total inventories Prepaid expenses and other current assets TOTAL CURRENT ASSETS PROPERTY, PLANT AND EQUIPMENT, NET GOODWILL TRADEMARKS AND OTHER INTANGIBLE ASSETS, NET OTHER NONCURRENT ASSETS TOTAL ASSETS 1.289 612 3.116 5.017 2.218 22.473 21.271 40,273 24,215 6,863 115.095 2.815 4.738 2.046 23 320 20.600 45,175 23,902 5313 118310 S $ $ 11.260 9.054 9,697 30.011 20,395 6,899 10,211 67,516 10,344 7.470 10,423 28.237 20.863 6,163 10,164 65.427 Liabilities and Shareholders' Equity CURRENT LIABILITIES Accounts payable Accrued and other liabilities Debt due within one year TOTAL CURRENT LIABILITIES LONG-TERM DEBT DEFERRED INCOME TAXES OTHER NONCURRENT LIABILITIES TOTAL LIABILITIES SHAREHOLDERS' EQUITY Convertible Class A preferred stock, stated value $1 per share (600 shares authorized) Non-Voting Class B preferred stock, stated value $i per share (200 shares authorized) Common stock, stated value S1 per share (10,000 shares authorized:shares issued: 2019.4,009. 2. 2018 - 4,009.2) Additional paid-in capital Reserve for ESOP debt retirement Accumulated other comprehensive income (less) Treasury stock, at cost (shares held: 2019-1.504.5, 2018-1.311.2) Retained earnings Noncontrolling interest TOTAL SHAREHOLDERS' EQUITY TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 928 967 4.009 63.827 (1.146) (14,936) (100.406) 94,918 385 47,579 115,095 4,009 63.846 (1.204) (14,749) (99.217) 98.641 590 $2,883 118310 $ $ See accompanying Notes to Consolidated Financial Statements The Procter & Gamble Company 35 Consolidated Statements of Earnings $ $ 66,832 14.432 19,037 2017 65,058 32,638 1 8,654 13.766 Amounts in millions except per share amounts: Years coded June 30 NET SALES Cost of products sold Selling, general and administrative expense Goodwill and indefinite lived intangibles impairment charges OPERATING INCOME Interest expense Interest income Other non-operating income (expense), net EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES Income taxes on continuing operations NET EARNINGS FROM CONTINUING OPERATIONS NET EARNINGS FROM DISCONTINUED OPERATIONS NET EARNINGS Less: Net camings attributable to noncontrolling interests NET EARNINGS ATTRIBUTABLE TO PROCTER & GAMBLE 2019 67,684 34,768 19,084 8,345 5.487 509 220 871 6,069 2,103 3,966 465 13.363 506 247 222 13.326 3,465 9,861 171 (215) 13.257 3,063 10,194 5.217 15,411 3,966 9,861 $ 3.897 $ 9,750 5 15 326 $ 1.45 $ 3.75 $ 3.79 2.01 5.80 $ 1.455 3.75 BASIC NET EARNINGS PER COMMON SHARE: Eamings from continuing operations Earnings from discontinued operations BASIC NET EARNINGS PER COMMON SHARE DILUTED NET EARNINGS PER COMMON SHARE: Earings from continuing operations Earnings from discontinued operations DILUTED NET EARNINGS PER COMMON SHARE $ 1.43 $ $ 3.67 - 3.67 3.69 1.90 5.59 1.43 $ $ Basic net carnings per common share and Diluted net camings per common share are calculated on Net carings attributable to Procter & Gamble See accompanying Notes to Consolidated Financial Statements
