Homework Answers
| a-1 | ||||||
| Gross margin percentages | Gross margin/Net sales | |||||
| Atlanta | Boston | |||||
| Gross margin | $19,430 | $24,000 | ||||
| Net sales | $36,100 | $88,600 | ||||
| Gross margin percentages | 53.82% | 27.09% | ||||
| Return on sales ratio | Net income/Net sales | |||||
| Atlanta | Boston | |||||
| Net income | $7,250 | $8,214 | ||||
| Net sales | $36,100 | $88,600 | ||||
| Return on sales ratio | 20.08% | 9.27% | ||||
| a-2 | ||||||
| Atlanta has higher gross margin percentages and higher return on sales ratio and thus is high end retailer | ||||||
| a-3 | ||||||
| Return on equity ratio | Net income/Equity | |||||
| Atlanta | Boston | |||||
| Net income | $7,250 | $8,214 | ||||
| Equity | $17,200 | $22,200 | ||||
| Return on equity ratio | 42.15% | 37.00% | ||||
| Thus, based on return on equity ratio Atlanta is more profitable business | ||||||
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The following income statements were drawn from the annual reports of the Atlanta Company and the...
The following income statements were drawn from the annual reports of the Atlanta Company and the...
The following income statements were drawn from the annual
reports of the Atlanta Company and the Boston Company:
*All figures are reported in thousands of dollars.
Required
*All figures are reported in thousands of dollars.
a-1. Compute the gross margin percentages and
return-on-sales ratios of Atlanta and Boston. (Round your
answers to the nearest whole number.)
a-2. One of the companies is a high-end retailer that
operates in exclusive shopping malls. The other operates discount
stores located in low-cost, standalone...
The following income statements were drawn from the annual reports of the Atlanta Company and the...
The following income statements were drawn from the annual reports of the Atlanta Company and the Boston Company Net Bales Coat of goods sold Gross margin Less: Operating exp. Selling and admin. exp. Net income Atlanta $ 210,000 (126, 000) 84,000 Boston $ 230,000 (179,400) 50, 600 (67,200) (32, 200) $ 16,800 $ 18,400 "All figures are reported in thousands of dollars. Required a-1. Compute the gross margin percentages and return-on-sales ratios of Atlanta and Boston a-2. One of the...
The following income statements were drawn from the annual reports of the Atlanta Company and the...
The following income statements were drawn from the annual reports of the Atlanta Company and the Boston Company anta Net sales Cost of goods sold Gross margin Lesss Operating exp 34,600 89,800 16,410)62,380) 27,420 18,190 Selling and admin.exp Net incone 20,880 s 6,230 6,540 All figures are reported in thousands of dollars. Required a-1. Compute the gross margin percentages and return-on-sales ratios of Atlanta and Boston. (Round your answers to the nearest whole number.) a-2. Ascertain which of the company...
The following income statements were drawn from the annual reports of Toner Sales Company: 2018* $...
The following income statements were drawn from the annual reports of Toner Sales Company: 2018* $ 426,600 (281,556) 145, 044 2019* $ 521,600 (292,096) 229,504 Net sales Cost of goods sold Gross margin Less: Operating expense Selling and administrative expenses Net Income (68,256) 76,788 (83,456) $ 146,048 $ *All dollar amounts are reported in thousands. The president's message in the company's annual report stated that the company had implemented a strategy to increase market share by spending more on advertising....
e following ratios are computed from the financial statements of the Wattawa Company. Compute the missing...
e following ratios are computed from the financial statements of the Wattawa Company. Compute the missing amounts on the firm's financial statements. Quick Ratio 1.0 Current Ratio 1.5 Accounts Receivable Turnover 5 Debt Ratio 30% Times Interest Earned 3 Inventory Turnover 4 Note: 1) For ratios that call for an average balance, use the year-end value only. 2) All sales were on credit. Wattawa Company Income Statement For the year ended December 31, 2018 Sales ? Less: Cost of Goods...
The following income statement was drawn from the records of Jordan Company, a merchandising firm: JORDAN...
The following income statement was drawn from the records of Jordan Company, a merchandising firm: JORDAN COMPANY Income Statement For the Year Ended December 31, Year 1 Sales revenue (5,500 units x $168) Cost of goods sold (5,500 units x $86) Gross margin Sales commissions (5% of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (5,500 units × $3) Net income $ 924,000 (473,000) 451,000 (46,200) (85,000) (38,000) (44,000) (16,500) $ 221,300 Required a. Reconstruct the...
The following income statement was drawn from the records of Campbell Company, a merchandising firm: CAMPBELL...
The following income statement was drawn from the records of Campbell Company, a merchandising firm: CAMPBELL COMPANY Income Statement For the Year Ended December 31, 2018 Sales revenue (5,500 units x $163) Cost of goods sold (5,500 units x $83) Gross margin Sales commissions (10% of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (5,500 units x $2) Net income $ 896,500 456,500 440,000 (89,650) (83,000) (33,000) (49,000) (11,000) $ 174,350 Required a. Reconstruct the income...
The following income statement was drawn from the records of Rundle Company, a merchandising firm: RUNDLE...
The following income statement was drawn from the records of Rundle Company, a merchandising firm: RUNDLE COMPANY Incone Statement Sales revenue (4,500 units $169) cost of goods sold (4,500 units x $84) Gross margin Sales commissions (58 of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (4,500 units $2) $ 760,500 (378,000) 382,500 (38,025) (89,000) (31,000) (46,000) (9,000) s 169,475 Required a. Reconstruct the income statement using the contribution margin format. b. Calculate the magnitude of...
The following income statement was drawn from the records of Campbell Company, a merchandising firm: CAMPBELL COM...
The following income statement was drawn from the records of Campbell Company, a merchandising firm: CAMPBELL COMPANY Income Statement For the Year Ended December 31, 2018 $1,072,500 (559,000) 513,500 (53,625) (84,000) (35,000) (48,000) Sales revenue (6,500 units x $165) Cost of goods sold (6,500 units x $86) Gross margin Sales commissions (58 of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (6,500 units x $2) (13,000) 279,875 Net income Required a. Reconstruct the income statement using...
The following income statement was drawn from the records of Butler Company, a merchandising firm: BUTLER...
The following income statement was drawn from the records of Butler Company, a merchandising firm: BUTLER COMPANY Income Statement For the Year Ended December 31, 2014 Sales revenue (4,000 units × $161) $ 644,000 Cost of goods sold (4,000 units × $86) (344,000 ) Gross margin 300,000 Sales commissions (5% of sales) (32,200 ) Administrative salaries expense (90,000 ) Advertising expense (37,000 ) Depreciation expense (42,000 ) Shipping and handling expenses (4,000 units × $5) (20,000 ) Net income $...
The following income statements were drawn from the annual
reports of the Atlanta Company and the Boston Company:
*All figures are reported in thousands of dollars.
Required
*All figures are reported in thousands of dollars.
a-1. Compute the gross margin percentages and
return-on-sales ratios of Atlanta and Boston. (Round your
answers to the nearest whole number.)
a-2. One of the companies is a high-end retailer that
operates in exclusive shopping malls. The other operates discount
stores located in low-cost, standalone...
The following income statements were drawn from the annual reports of the Atlanta Company and the Boston Company Net Bales Coat of goods sold Gross margin Less: Operating exp. Selling and admin. exp. Net income Atlanta $ 210,000 (126, 000) 84,000 Boston $ 230,000 (179,400) 50, 600 (67,200) (32, 200) $ 16,800 $ 18,400 "All figures are reported in thousands of dollars. Required a-1. Compute the gross margin percentages and return-on-sales ratios of Atlanta and Boston a-2. One of the...
The following income statements were drawn from the annual reports of the Atlanta Company and the Boston Company anta Net sales Cost of goods sold Gross margin Lesss Operating exp 34,600 89,800 16,410)62,380) 27,420 18,190 Selling and admin.exp Net incone 20,880 s 6,230 6,540 All figures are reported in thousands of dollars. Required a-1. Compute the gross margin percentages and return-on-sales ratios of Atlanta and Boston. (Round your answers to the nearest whole number.) a-2. Ascertain which of the company...
The following income statements were drawn from the annual reports of Toner Sales Company: 2018* $ 426,600 (281,556) 145, 044 2019* $ 521,600 (292,096) 229,504 Net sales Cost of goods sold Gross margin Less: Operating expense Selling and administrative expenses Net Income (68,256) 76,788 (83,456) $ 146,048 $ *All dollar amounts are reported in thousands. The president's message in the company's annual report stated that the company had implemented a strategy to increase market share by spending more on advertising....
The following income statement was drawn from the records of Jordan Company, a merchandising firm: JORDAN COMPANY Income Statement For the Year Ended December 31, Year 1 Sales revenue (5,500 units x $168) Cost of goods sold (5,500 units x $86) Gross margin Sales commissions (5% of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (5,500 units × $3) Net income $ 924,000 (473,000) 451,000 (46,200) (85,000) (38,000) (44,000) (16,500) $ 221,300 Required a. Reconstruct the...
The following income statement was drawn from the records of Campbell Company, a merchandising firm: CAMPBELL COMPANY Income Statement For the Year Ended December 31, 2018 Sales revenue (5,500 units x $163) Cost of goods sold (5,500 units x $83) Gross margin Sales commissions (10% of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (5,500 units x $2) Net income $ 896,500 456,500 440,000 (89,650) (83,000) (33,000) (49,000) (11,000) $ 174,350 Required a. Reconstruct the income...
The following income statement was drawn from the records of Rundle Company, a merchandising firm: RUNDLE COMPANY Incone Statement Sales revenue (4,500 units $169) cost of goods sold (4,500 units x $84) Gross margin Sales commissions (58 of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (4,500 units $2) $ 760,500 (378,000) 382,500 (38,025) (89,000) (31,000) (46,000) (9,000) s 169,475 Required a. Reconstruct the income statement using the contribution margin format. b. Calculate the magnitude of...
The following income statement was drawn from the records of Campbell Company, a merchandising firm: CAMPBELL COMPANY Income Statement For the Year Ended December 31, 2018 $1,072,500 (559,000) 513,500 (53,625) (84,000) (35,000) (48,000) Sales revenue (6,500 units x $165) Cost of goods sold (6,500 units x $86) Gross margin Sales commissions (58 of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (6,500 units x $2) (13,000) 279,875 Net income Required a. Reconstruct the income statement using...
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