Consider the data for McConnell Department Stores presented in Problem.

Requirements
1. Prepare a common- size income statement and balance sheet 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) profit margin ratio. 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. Assume the current ratio industry average is 1.47 and the debt to equity industry average is 1.83. Is McConnell’s financial position better or worse than the industryaverages?

MCCONNELL DEPARTMENT STORES, INC. Income Statement Compared with Industry Average Year Ended December 31, 2014 Industry McConnellArage $778,000 100.0% Net Sales Cost of Goods Sold Gross Profit Operating Expenses Operating Income Other Expenses Net Income 161,046 94,138 4,668 $ 89,470 522816 65.6 255,184 34.2 19.7 14.5 0.4 14.1% MCCONNELL DEPARTMENT STORES, INC. Balance Sheet Compared with Industry Average December 31, 2014 Industry McConnel Average Curent Assets Fixed Assets, Net Intangible Assets, Net Other Assets Total Assets 325,440 120,960 8,640 24,960 480,000 70.9% 23.6 0.8 100.0% Current Liabilities Long-term Liabilities Total Liabilities Stockholders' Equity Total Liabilities and Stockholders' Equity 222,720 48.1% 107,520 330,240 149,760 16.6 64.7 35.3 100.0% S 480,000