THE PRINTER COMPANY Comparative Income Statement For the Years Ended December 31, 2010 and 2009 Revenue: 2010 2009

Sales 895,000 705,450

Less Sales Returns and Allowances 12,500 11,650

Net Sales 882,500 693,800

Cost of Goods Sold

Merchandise Inventory, January 1 82,500 80,000

Net Purchases 306,000 262,000

Total Merchandise Available for Sale 388,500 342,000

Less Merchandise Inventory, Dec 31 85,000 82,500

Cost of Goods Sold 303,500 259,500

Gross Profit on Sales 579,000 434,300

Operating Expenses

Selling Expenses

Sales Salaries Expense 87,000 79,000

Payroll Tax Expense-Selling 8,700 7,900

Other Selling Expenses 25,800 15,200

Total Selling Expenses 121,500 102,100

General and Administrative Expenses

Officers Salaries Expense 130,000 110,000

Payroll Tax Expense-Administrative 13,000 11,000

Depreciation Expense 8,250 8,250

Other General and Admin Expenses 9,450 7,000

Total General and Admin Expenses 160,700 136,250

Total Operating Expenses 282,200 238,350

Net Income Before Income Taxes 296,800 195,950

Income Tax Expense 89,040 58,785

Net Income After Income Taxes 207,760 137,165

THE PRINTER COMPANY

Comparative Balance Sheet

December 31, 2010 and 2009

Assets

Current Assets

Cash 88,375 47,256

Accounts Receivable 60,000 37,500

Merchandise Inventory 85,000 82,500

Prepaid Expenses 9,500 5,000

Supplies 1,000 434

Total Current Assets 243,875 172,690

Property, Plant, and Equipment

Land 75,000 75,000

Building and Equipment 82,500 82,500

Less Accumulated Depreciation (33,000) (24,750)

Net Book Value-Building and Equipment 49,500 57,750

Total Property, Plant, and Equipment 124,500 132,750

Total Assets 368,375 305,440

Liabilities and Stockholders' Equity

Current Liabilities

Accounts Payable 22,600 55,542

Sales Tax Payable 1,000 3,000

Payroll Taxes Payable 1,142 1,025

Income Taxes Payable 1,000 5,000

Total Current Liabilities 25,742 64,567

Long-Term Liabilities

Mortgage Payable 39,000 45,000

Total Long-Term Liabilities 39,000 45,000

Total Liabilities 64,742 109,567

.Stockholders' Equity

Common Stock ($1 par, 10,000 shares authorized 10,000 shares

issued and outstanding) 10,000 10,000

Paid-in-Capital - Common Stock 10,000 10,000

Retained Earnings 283,633 175,873

Total Stockholders' Equity 303,633 195,873

Total Liabilities and Stockholders' Equity 368,375 305,440

Using the information given above, calculate the below financial ratios. Complete a comparison between the two years for this company and remember to use Excel formulas and link cells when possible. Be sure to explain how the ratios compare (expand beyond just stating which one is larger) and why.

1. Current Ratio

2. Acid-test Ratio

3. Inventory Turnover

4. Return on Sales

5. Earnings per Share of Common Stock

6. Return on Total Assets

7. Rate of Return on Stockholders' Equity

8. Asset Turnover