Question

Selected comparative financial statements of Telecom Company follow: Required: 1. Express the income statement data in Trend percentage with 2015 as the base year (4) 2. Express the balance sheet data in Common-Size percentage (6) 3. Compute each year's Quick ratio, Debt ratio, Profit margin ratio, Return on Assets. (4) 4. Analyse and comment on any significant relations revealed by the percents and ratios computed. (2) Telecom Company Comparative Balance Sheets December 31, 2017, 2016 and 2015 2017 2016 2015 Assets Current Assets Long-Term Investments Plant Assets, Net Total Assets $55,860 0 113.810 $169.670 $33,660 2700 114.660 $151.020 $37,300 11,600 80.000 $128.900 Liabilities & Equity Current Liabilities Common stock Other contributed capital Retained earnings Total Liabilities and equity $ 23,370 47,500 14,850 83.950 $169.670 $ 20,180 47,500 14,850 68.490 $151.020 $ 17,500 38,000 12,300 61.100 $128.900 Telecom Company Comparative income statements For the year ended December 31, 2017, 2016 and 2015 2017 2016 Sales $199,800 $167,000 Cost of goods sold 109,890 87,175 Gross profit 89,910 79,825 Selling Expenses 23,680 20,790 Administrative expenses 17.760 15.610 Total expenses 41,440 36.400 Income before taxes 48,470 43,425 Income taxes 5,050 4,910 Net income $43.420 $38.515 2015 $144,800 67,200 77,600 19,000 16.700 35.700 41,900 4,300 $37.600