Below are the financial statements for two entertainment firms, Crosby Co. and Prairie Inc. for 2017...

    

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Below are the financial statements for two entertainment firms, Crosby Co. and Prairie Inc. for 2017 and 2018 a) How did Crosby Co.'s profit margins change from 2017 to 2018? To what would you attribute the differences? Answer the same question for Prairie Inc. b) Compare the profit margins between Crosby Co. and Prairie Inc. How are they different? How would you explain these differences? c) What differences do you notice in the common-sized balance sheets that might indicate that one of the firms is doing better than the other? INCOME STATEMENT 2017 %Sales 2018 %Sales Sales 42,278 45,041 Cost of goods sold 33,415 35,591 Gross profits Selling, general and administrative expenses 139 283 Depreciation and amortization Other operating expenses Operating Income Interest expenses 369 235 Nonoperating income (or expenses) 905 688 Earnings before tax Income taxes 3,087 2,984 Net Income Common outstanding shares 932 942 Earnings per share ASSETS 2017 %BalTot 2018 %Ballot Cash and short-term investments 3,387 3,931 Receivables 6,540 6,967 Inventory 1,537 1,487 Other current assets 2,245 1,724 Total current assets Gross fixed assets 38,582 41,192 Accumulated depreciation and amortization -20,687 -22,459 Net fixed assets Other assets 43,294 48,399 Total fixed asets Total assets Total fixed asets Total assets LIABILITIES 2017 %BalTot 2018 %BalTot Account payable 4,619 4,899 Short-term notes payable 3,614 1,512 Other current liabilities 4,580 5,293 Deferred taxes 2,251 4,050 Total current liabilities Long term debts 10,981 13,050 Other long-term liabilities 9,094 7,008 Total long-term liabilities Total liabilities EQUITY Par value Common stock sold 31,731 33,440 Total common stock sold Treasury stock -31,671 -34,582 Total common stock Retained earnings 42,965 47,758 Other equity -3,266 -1,187 Total common equity Total liabilities and equity Below are the financial statements for two entertainment firms, Crosby Co. and Prairie Inc. for 2017 and 2018 a) How did Crosby Co.'s profit margins change from 2017 to 2018? To what would you attribute the differences? Answer the same question for Prairie Inc. b) Compare the profit margins between Crosby Co. and Prairie Inc. How are they different? How would you explain these differences? c) What differences do you notice in the common-sized balance sheets that might indicate that one of the firms is doing better than the other? INCOME STATEMENT 2017 %Sales 2018 %Sales Sales 42,278 45,041 Cost of goods sold 33,415 35,591 Gross profits Selling, general and administrative expenses 139 283 Depreciation and amortization Other operating expenses Operating Income Interest expenses 369 235 Nonoperating income (or expenses) 905 688 Earnings before tax Income taxes 3,087 2,984 Net Income Common outstanding shares 932 942 Earnings per share ASSETS 2017 %BalTot 2018 %Ballot Cash and short-term investments 3,387 3,931 Receivables 6,540 6,967 Inventory 1,537 1,487 Other current assets 2,245 1,724 Total current assets Gross fixed assets 38,582 41,192 Accumulated depreciation and amortization -20,687 -22,459 Net fixed assets Other assets 43,294 48,399 Total fixed asets Total assets Total fixed asets Total assets LIABILITIES 2017 %BalTot 2018 %BalTot Account payable 4,619 4,899 Short-term notes payable 3,614 1,512 Other current liabilities 4,580 5,293 Deferred taxes 2,251 4,050 Total current liabilities Long term debts 10,981 13,050 Other long-term liabilities 9,094 7,008 Total long-term liabilities Total liabilities EQUITY Par value Common stock sold 31,731 33,440 Total common stock sold Treasury stock -31,671 -34,582 Total common stock Retained earnings 42,965 47,758 Other equity -3,266 -1,187 Total common equity Total liabilities and equity