Carter Ltd. has asked for your help in comparing the company's profit performance and financial position with the computer services industry average. The manager has given you the company's income statement and balance sheet, and also the following industry average data for computer services companies:

Carter Ltd.
Income Statement
For the Year Ended December 31, 2020
		Industry
	Carter Ltd.	Average
Net sales	$433,000	100.00%
Cost of goods sold	251,000	53.2
Gross margin	182,000	46.8
Operating expenses	90,000	21.3
Operating income	92,000	25.5
Other expenses	25,000	5.2
Net income	$67,000	20.30%

Carter Ltd.
Balance Sheet
31-Dec-20
		Industry
	Carter Ltd.	Average
Current assets	$171,000	62.50%
Property and equip., net	88,000	35.2
Other assets	6,800	2.3
Total assets	$265,800	100.00%
Current liabilities	$115,000	42.50%
Long-term liabilities	63,000	32.5
Shareholders' equity	87,800	25
Total liabilities and shareholders' equity	$265,800	100.00%

1.	Make a two-column common-size income statement and a two-column common-size balance sheet for Carter Ltd. The first column of each statement should present Carter Ltd.'s common-size statement, and the second column should show the industry averages.
2.	For the profitability analysis, compare each of Carter Ltd.'s (a) ratio of gross margin to net sales, (b) ratio of operating income to net sales, and (c) ratio of net income to net sales. Compare these figures to the industry averages. Is Carter Ltd.'s profit performance better or worse than the industry average?
3.	For the analysis of financial position, compare each of Carter Ltd.'s (a) ratio of current assets to total assets, and (b) ratio of shareholders' equity to total assets to the industry averages. Is Carter Ltd.'s financial position better or worse than the industry averages?