Comparative income statement data for Manitou Ltd. and Muskoka Ltd., two competitors, are shown below for the

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Comparative income statement data for Manitou Ltd. and Muskoka Ltd., two competitors, are shown below for the year ended June 30, 2024. 


Instructions 

a. Using vertical analysis, calculate the percentage of the base amount of the income statement for each company. 

b. Calculate the gross profit margin, profit margin, asset turnover, return on assets, and return on equity ratios for 2024 for each company. 

c. Using the information calculated in parts (a) and (b), compare the profitability of each company. 

d. Is your comparison in part (c) an intracompany comparison or an intercompany comparison? Explain. 


How is your assessment of profitability affected by the differing sizes of the two companies, if at all? Explain.

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Related Book For  book-img-for-question

Accounting Principles Volume 2

ISBN: 9781119786634

9th Canadian Edition

Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak

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