Gildan Activewear Inc. is a Montreal-based company that manufactures and sells activewear, socks, and underwear. The companys
Question:
Gildan Activewear Inc. is a Montreal-based company that manufactures and sells activewear, socks, and underwear. The company’s brands include Gildan, Gold Toe, and Anvil. The company also manufactures products through licensing arrangements with Under Armour and New Balance brands. Exhibit 4.14 presents the company’s consolidated statements of earnings and comprehensive income for the years ended January 3, 2021, and December 29, 2019.
Required
a. Gildan reports “net sales” on its consolidated statements of earnings. Explain what this means.
b. Calculate the amount of Gildan’s gross profit percentage for 2020 and 2019. Has it improved?
c. Using the financial statements in Appendix A, calculate Dollarama’s gross profit percentages for the same periods. How do they compare with Gildan’s percentages?
d. Does Gildan prepare its consolidated statements of earnings using a single-step or a multi-step approach?
e. Does Gildan present its expenses by function or by nature? Does this approach require a higher level of management judgement when preparing the statement?
Step by Step Answer:
Understanding Financial Accounting
ISBN: 9781119715474
3rd Canadian Edition
Authors: Christopher D. Burnley