The McConnell Department stores, Inc., chief executive officer (CEO) has asked you to compare the company's profit performance and financial position with the average for the industry. The CEO has given you the company's income statement and balance sheet, as well as the industry average data for retailers. Requirement 1. Prepare a common-size income statement for Mcdonald Department stores. (round your answers to one decimal place.)

McConnell %

Net sales ?

Cost of goods sold ?

Gross profit ?

Operating expenses ?

Operating income ?

Other expenses ?

Net Income ?

Prepare a common-size balance sheet for McConnell. (Round your answers to one decimal place.)

McConnell %

Current assets ?

Fixed assets,net ?

Intangible assets,net ?

other assets ?

total assets ?

current liabilities ?

long-term liabilities ?

stockholders equity ?

total liabilities and stockholder's equity ?

Question 2.

Financial statement data of American traveler Magazine include the following items (dollars in thousands)

Requirement 1. Compute American traveler's current ratio, and earnings per. share. (round all ratios to two decimal places)

Current Ratio Debt Ratio Earnings Per Share

Requirement 2. Compute the three ratios after evaluating the effects of each transaction. Consider each transaction separately. (round all ratios to two decimal places.)

Current ratio Debt ratio Earning Per Share

a a a

b b b

c c c

d d d

McConnell Department Stores, Inc. Income Statement Compared with Industry Average Year Ended December 31, 2010 Industry McConnell Average Net sales $781,000 100.0 % Cost of goods sold 528737 65.8 Gross profit 252263 34.2 Operating expenses 160105 19.7 Operating income 92158 14.5 Other expenses 5467 0.4 Net income $86,691 14.1 % McConnell Department Stores, Inc. Balance Sheet Compared with Industry Average December 31, 2010 Industry McConnell Average Current assets $284,760 70.9 % Fixed assets, net 109200 23.6 Intangible assets, net 5880 0.8 Other assets 20160 4.7 Total assets $420,000 100.0 % Current liabilities $194,040 48.1 % Long'term liabilities 95760 16.6 Stockholders' equity 130200 35.3 Total liabilities and stockholders' equity $420,000 100.0 % Cash $23,000 Accounts receivable, net $81,000 Inventories $189,000 Total assets $634,000 Short'term notes payable $51,000 Accounts payable $100,000 Accrued liabilities $35,000 Long'term liabilities $222,000 Net income $74,000 Common shares outstanding 50000