You have been hired as a financial analyst at Morgan Corporation. Your responsibilities are to assist in the construction and interpretation of the financial statements and communicate on the overall results of the company. You will be reporting to the senior management team of Morgan. During your first few weeks with the company, you have heard about big plans for a new product line. In the past, Morgan has always sold sporting goods and equipment. However, management wants to begin selling clothing and other apparel items starting this year. Morgan is expecting you to accomplish three specific items in the near future:

1. Create comparative financial statements for 2010 and 2011

.2. Perform select ratio analysis on these financial statements . 

3. Take assumptions from management for this new clothing line and construct a Pro Forma income Statement for 2012. Basically, you want to give management an idea of what the company could look like after 2012 from a sales and profit perspective if their assumptions prove correct. Remember that pro forma statements forecast the future.4. You are encouraged to be creative. However, be sure to follow good financial statement format. Refer to your textbook for samples for using proper formats to create financial statements. Deliverable Descriptions: . 

Part 1: Construct Comparative Multistep Income Statements and Balance Sheets You will take various account balance information from Morgan for the past 2 years, interpret the accounts, and then construct Comparative Multistep Income Statements and Classified Balance Sheets for 2010 and 2011. •You will then take these statements and use them to create a Statement of Cash Flows for 2011.This should be handed in as an excel spreadsheet (s). 

• Part 2:Five Ratios and Interpret your results You will take the completed financial statements from ratio Analyses on Profit Margin, Current Ratio, Receivables Turnover, Inventory Turnover, and Return on Assets. After completing the 5 ratios interpret your results and communicate them in a report to management Describe the strengths and weaknesses of the company based on your evaluation of the financial statements and ratios. Part 3: Create a Pro Forma Income Statement • Using the 2011 Income Statement you completed, take the current year 2012 assumptions from management to construct a Pro Forma Income Statement .