Scenario: 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.

Morgan is expecting you to accomplish three specific items in the near future:

1. Createcomparativefinancialstatementsfor2010and2011.
2. Performselectratioanalysisonthesefinancialstatements.
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. Youareencouragedtobecreative.However,besuretofollowgoodfinancialstatementformat.Refertoyourtextbookforsamplesforusingproperformatstocreatefinancialstatements.

Part 1: Construct Comparative Multistep Income Statements and Balance Sheets (Due Week 4)

• YouwilltakevariousaccountbalanceinformationfromMorganforthepast2years,interprettheaccounts,andthenconstructComparativeMultistepIncomeStatementsandClassifiedBalanceSheetsfor2010and2011.
• YouwillthentakethesestatementsandusethemtocreateaStatementofCashFlowsfor2011.Thisshouldbehandedinasanexcelspreadsheet(s).