Complete the following activity:

The Excel spreadsheet file (attached below) contains balance sheets and income statements for two fictitious retail companies.

Review their (1) revenues, (2) cost of sales, and (3) operating expenses, and calculate their respective working capital (cash and accounts receivable, minus the firms current liabilities) and gross and net margins.

Is one company financially stronger than the other? If so, which one and why?

Write a 24 paragraph report explaining and defending your conclusions. At an appropriate place in the report, include a 3-D bar graph comparing the five categories of financial data to support your conclusions.

Balance Sheets (at December 31, 2011)
	Company 1	%	Company 2	%
Cash	$ 333,000,000		$ 611,100,000
Net Receivables	$ 107,300,000		$ 46,000,000
Inventories	$ 135,700,000		$ 29,900,000
Long-Term Assets	$ 176,500,000		$ 137,900,000
Total Assets	$ 419,500,000		$ 824,900,000
Total Current Liabilities	$ 137,500,000		$ 370,200,000
Long-Term Debt	$ 50,000,000		$ 120,000,000
Other Liabilities	$ 54,000,000		$ 79,200,000
Total Liabilities	$ 241,500,000		$ 569,400,000
Total Shareholders Equity	$ 178,000,000		$ 255,500,000
Working Capital
Income Statements (for the fiscal year ending 2011)
	Company 1	%	Company 2	%
Revenue	$ 426,000,000		$ 605,600,000
Cost of Goods Sold	$ 156,900,000		$ 175,900,000
Gross Profit	$ 269,100,000		$ 429,700,000
Gross Profit Margin
Operating Expenses	$ 111,200,000		$ 210,300,000
Depreciation & Amortization	$ -		$ 36,900,000
Other Expenses	$ 11,200,000		$ -
Operating Income	$ 146,700,000		$ 182,500,000
Operating Margin
Adjustments	$ 34,900,000		$ (2,800,000)
Total Net Income	$ 111,800,000		$ 185,300,000
Net Profit Margin