The financial statements of M&S are presented in Appendix E. The company’s complete annual report, including the notes to the fi nancial statements, is available online.

Instructions

Refer to M&S’s financial statements and the accompanying notes to answer the following questions.

a. What type of income statement format does M&S use? Indicate why this format might be used to present income statement information.

b. What are M&S’s primary revenue sources?

c. Compute M&S’s gross profit for each of the years 2016 and 2017.

d. Why does M&S make a distinction between operating and non-operating profit?

e. Does M&S report any non-GAAP measures? Explain.