Winnipeg-based New Flyer Industries Inc. is one of North America’s largest manufacturers of heavyduty transit buses. Excerpts from its 2016 financial statements are in Exhibits 2.20A and 2.20B. EXHIBIT 2.20A New Flyer Industries Inc.’s 2016 Consolidated Statements of Net Earnings and Comprehensive Income

EXHIBIT 2.20B New Flyer Industries Inc.’s 2016 Consolidated Statements of Financial Position

Required

Use the financial statements to answer the following questions.

a. Calculate the growth in the following accounts from December 31, 2015, to January 1, 2017:

i. Revenue
ii. Cost of Sales
iii. Net Earnings
iv. Total Assets
v. Total Equity

Would you expect each of these accounts to grow at the same rate? Why or why not? Comment on the growth rates you calculated.

b. Based on your analysis from part “a,” did the equity investors finance more of the company in 2016 than they did in 2015?

c. Calculate the following ratios for each of the two years presented. (Note that, in order to be able to calculate these ratios for each of the years, you will have to use the total assets for each year and the total shareholders’ equity for each year in your ratios, rather than average total assets and average shareholders’ equity.)
i. Profit margin ratio
ii. Return on assets
iii. Return on equity
Comment on your results. Do the results from part “a” help you interpret the changes in these ratios? Why or why not?

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NEW FLYER INDUSTRIES INC. Consolidated Statements of Net Earnings and Comprehensive Income 53 weeks ended January 1, 2017 (“Fiscal 2016“) and 52 weeks ended December 27, 2015 (“Fiscal 2015") (in thousands of U.S. dollars except per share figures) Fiscal 2016 Fiscal 2015 $1,538,900 Revenue (note 20) $2,274,176 Cost of sales (note 4, 25) 1,341,452 1,874,847 Gross profit 399,329 197,448 Sales, general and administration costs and other operating expenses (note 25) 103,898 186,420 Fiscal 2016 Fiscal 2015 (3,639) (765) Foreign exchange gain (note 19c) Impairment loss on equipment and intangible assets (note 6) 1,413 Earnings from operations 216,548 92,902 Unrealized foreign exchange loss on non-current monetary items 1,775 2,226 Loss on derecognition of long-term debt (note 10) 726 Earnings before interest and income taxes 214,773 89,950 Interest and finance costs Interest on long-term debt and convertible debentures 18,129 9,330 Accretion in carrying value of long-term debt and convertible debentures 2,482 2,457 Other interest and bank charges 6,226 2,814 (5,860) Fair market value adjustment on interest rate swap (382) 20,977 14,219 Earnings before income tax expense 75,731 193,796 Income tax expense (note 7) 71,592 Current income taxes 45,344 Deferred income taxes recovered (2,690) (23,507) 68,902 21,837 Net earnings for the period 124,894 53,894 NEW FLYER INDUSTRIES INC. Consolidated Statements of Financial Position As at January 1, 2017 and December 27, 2015 (in thousands of U.S. dollars) December 27, 2015 revised (note 1.1) January 1, 2017 Assets Current Cash $ 13,047 $ 24,880 Accounts receivable (note 3,19 c) 376,443 329,105 Income tax receivable 4,723 Inventories (note 4) 364,628 352,351 Derivative financial instruments (note 19 b,c) 1,770 Prepaid expenses and deposits 13,383 6,560 769,271 717,619 Property, plant and equipment (note 5) 131,581 127,679 Derivative financial instruments (note 19 b,c) 4,509 Deferred tax assets (note 7) 22,333 14,301 Goodwill and intangible assets (note 6) 894,709 926,042 $1,822,403 $1,785,641