Project The required tasks are detailed below: (1) Prepare vertical common-size income statements and balance sheets for both companies. Note: Use "Total Sales" and "Total Assets" as the denominators for income statement and balance sheet, respectively. Compute for 2018, 2017, and 2016. (2) Prepare horizontal analysis on income statements and balance sheets for both companies. (3) Prepare ratio analyses (for 2018, 2017, and 2016) for both companies. You should include the following ratios in your computations: Profitability ratios O Gross Profit margin Profit margin O Return on assets O Return on equity Productivity o Inventory Tumover o days inventory outstanding OPPE Turnover Asset Turnover Solvency o Debt-to-equity o Times interest earned o Return on Financial leverage Liquidity O Current Ratio O Quick Ratio o Working capital (3) Comment on the analytical results of the two companies based on your work in excel. In addition to contrasting the ratios between the companies, you should interpret the numbers and make suggestions as to why the ratio of one company might be higher lower than the other. Note: General discussions of the ratios are given in our textbook, which will help you structure your comments (4) Write a conclusive summary on the firms you have studied. Based upon your conclusions, recommend the better performing firm for potential investment. Your conclusions should be based upon, and specifically reference, the analyses prepared in this report. Balance sheet Income Statement WOTE BALANCEST RARON LOURDESDG $100 1272.000 10 312000 SY 1.000 000 915 000 335.290.000 $1.137.000 5510 000 ST22.000 31.110.000 000 l ete And comp Deted $120.000 2000 $1378,000 51 950 000 1120.000 $19000 eta euren Long term debeting current mauris Defen d ed protection plans $11.545000 000 48.000 SAT. 000 12.000 Stockholders' Equity Como 000 $5 .00 Rated Acum cher comprehensive income To shareholder Toe and others 11544 534.500.000 2000 14.40.000 Anton Lowe's Balance sheet Income Statement As Re Report Dute c ommend Co Opening income 846 Lowongan 2100 000 Additional information We were dig. Lowe's Balance Sheet Income Statement God Long i ng current Com 10.000 shares d e 2011 and 22 h Amherches Trouryo Total des dick Total and eckholders Car Home Depot Balance Sheet Income Statement Income Statement Net Sales 314.595 5222 32313 Gross profit Operating expenses Seling general and administrative Depreciation and amortization 17,132 18.886 Total operating expenses Operating income Interest and other income) expenses Interest and investment income Interest and other net Earnings before provision for income taxes Provision for income taxes Net earnings 12.491 4.534 $11,121 Additional Information Basic weighted average common shares Cash dividend per share Operating cash flow for the year 2783 Home Depot Project The required tasks are detailed below: (1) Prepare vertical common-size income statements and balance sheets for both companies. Note: Use "Total Sales" and "Total Assets" as the denominators for income statement and balance sheet, respectively. Compute for 2018, 2017, and 2016. (2) Prepare horizontal analysis on income statements and balance sheets for both companies. (3) Prepare ratio analyses (for 2018, 2017, and 2016) for both companies. You should include the following ratios in your computations: Profitability ratios O Gross Profit margin Profit margin O Return on assets O Return on equity Productivity o Inventory Tumover o days inventory outstanding OPPE Turnover Asset Turnover Solvency o Debt-to-equity o Times interest earned o Return on Financial leverage Liquidity O Current Ratio O Quick Ratio o Working capital (3) Comment on the analytical results of the two companies based on your work in excel. In addition to contrasting the ratios between the companies, you should interpret the numbers and make suggestions as to why the ratio of one company might be higher lower than the other. Note: General discussions of the ratios are given in our textbook, which will help you structure your comments (4) Write a conclusive summary on the firms you have studied. Based upon your conclusions, recommend the better performing firm for potential investment. Your conclusions should be based upon, and specifically reference, the analyses prepared in this report. Balance sheet Income Statement WOTE BALANCEST RARON LOURDESDG $100 1272.000 10 312000 SY 1.000 000 915 000 335.290.000 $1.137.000 5510 000 ST22.000 31.110.000 000 l ete And comp Deted $120.000 2000 $1378,000 51 950 000 1120.000 $19000 eta euren Long term debeting current mauris Defen d ed protection plans $11.545000 000 48.000 SAT. 000 12.000 Stockholders' Equity Como 000 $5 .00 Rated Acum cher comprehensive income To shareholder Toe and others 11544 534.500.000 2000 14.40.000 Anton Lowe's Balance sheet Income Statement As Re Report Dute c ommend Co Opening income 846 Lowongan 2100 000 Additional information We were dig. Lowe's Balance Sheet Income Statement God Long i ng current Com 10.000 shares d e 2011 and 22 h Amherches Trouryo Total des dick Total and eckholders Car Home Depot Balance Sheet Income Statement Income Statement Net Sales 314.595 5222 32313 Gross profit Operating expenses Seling general and administrative Depreciation and amortization 17,132 18.886 Total operating expenses Operating income Interest and other income) expenses Interest and investment income Interest and other net Earnings before provision for income taxes Provision for income taxes Net earnings 12.491 4.534 $11,121 Additional Information Basic weighted average common shares Cash dividend per share Operating cash flow for the year 2783 Home Depot