Consider the data for McConnell Department Stores presented in P15 23A Requirements 1 Prepare a common size income statement and balance sheet for McConnell The first column of each statement should present McConnells common size statement, and the second column, the industry averages 2 For the pro...

Req 1 McConnell Department Stores Inc CommonSize Income Statement Compared to Industry Average Year ...

Consider the data for McConnell Department Stores presented in P15-23A. Requirements 1. Prepare a common-size income statement

Question:

Consider the data for McConnell Department Stores presented in P15-23A.
Requirements
1. Prepare a common-size income statement and for McConnell. The first column of each statement should present McConnell’s common-size statement, and the second column, the industry averages.
2. For the profitability analysis, compute McConnell’s
(a) Gross profit percentage and
(b) Rate of return on net sales. Compare these figures with the industry averages. Is McConnell’s profit performance better or worse than the industry average?
3. For the analysis of financial position, compute McConnell’s (a) current ratio and (b) debt to equity ratio. Compare these ratios with the industry averages. Is McConnell’s financial position better or worse than the industry averages?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...