Question: Please help to solve this case, and information is below, thank you. Case 1. Can you identify industry characteristics? If you were asked to visualize
Please help to solve this case, and information is below, thank you.



Case 1. Can you identify industry characteristics? If you were asked to visualize (in income statement and balance sheet form) the financial structure of a typical firm in one particular industry, do you think you could do it? How close to your "vision" do you think the "reality" would be? What if you were asked to do the same experiment covering 14 firms drawn from 14 different industries? How many of the 14 do you think you would get right? You may be surprised by how much you already know! Attached table presents the balance sheets (in percentage form) and other selected financial data for 14 firms drawn from 14 different industries While there are clear differences in the financial structures of different firms within a single industry, the firms selected have figures that are broadly typical of those in their industry. Try to match the 14 firms operating in the 14 industries named below with the 14 sets of financial data presented in Exhibit 1. Use any approach you find helpful. Advertising agency (about half of total revenue derived from commissions that equal 15% of media purchases for clients) Airline Bookstore chain v wivetoy Commercial bank (fitted into the most nearly comparable balance sheet and ratio categories of the nonfinancial companies) no inventor 5. Computer software developer maybe, depends, some inventay 6. Department store chain (with its "own brand" charge card)v inventor 7. Electric and gas utility (with 72% of its revenue from electricity sales and 28% of its revenue from natural gas sales) v inventay 8. Family restaurant chain v inventowl Health maintenance organization (HMO) 10. Online bookseller anven-tow 11. Online direct factory to customer personal computer vendor (with more than half of sales to business customers and most manufacturing outsourced) 12. Pharmaceutical manufacturer Retail drug chain Retail grocery chain 13. Retail drug chain y inventory 14. Retail grocery chain v inventory service providers EGMN =7127493 Write down the industry name next to the Financial Statement identifier. Industry Name Industry A Advertising agency Health maintenance Organization (HMO Airline Z Commercial BankExhibit 1 Balance Sheet Percentages and Selected Financial Data for Unidentified Industries Service industry => NO inventory etc. Omputter restawant reta/ Close w zero ( maintain, vetiverd dep Store retail ERC Line Balance Sheet Percentages B D F H any Cash and marketable securities Accounts receivable 3. Inventories Other current assets Plant & equipment (net) 86 64- Other assets ONINNg ON Total assets" Notes payable Accounts payable 8BONG-No 850moo ghoomooud SoooSN 10. Accrued Items 12. Other curront llabilities Long-term debt 13. Other liabilities 8BONOo Gi No 15. Preferred stock 18. Common stock Total llabilities and net worth" Selected Financial Data 17. 18. Current assets/current llabillties Cash, MS, and ARs/current liabliities 1.62 1.18 1.1 1.65 2.18 1.10 1.3 1.6 1.17 20. 19. X Inventory tumover (X) Receivables collection period (days) 114 10.2 21. Total debt/total assets 8 8 83 Long-term debt/capitalization 23. Revenue/total assets 2.297 Net profit/revenue .042 1.813 .020 2.419 .084 .158 2.070 1.90 2.958 .08 26. 26. Net profit/total assets .097 .02 .675 .048 .155 .06 .050 .181 .045 .059 .112 .018 .047 .08 .042 .026 .072 .20 8.8 .018 27. Total assetset worth 16,02 2.84 6.60 4.03 1.74 Net profitet worth .865 ,200 2.74 2.45 1.459 .131 .123 .123 .275 .218 2.45 .104 1.68 3.8 09 2.10 13.28 .173 ,082 .21 Source: Compiled from company annual reports. Mo Girlwe NA = Not applicable. N-> Commercial bank "Column totals may not add to 100 due to rounding. (coutact +, tool p) G HMO
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