Project

The required tasks are detailed below:

$(1)$ Prepare vertical common$-$size income statements and balance sheets for both companies.

Note: Use "Total Sales" and "Total Assets" as the denominators for income statement

and balance sheet, respectively. Compute for $2022,2021,$ and $2020.$

$(2)$ Prepare horizontal analysis on income statements and balance sheets for both companies

for $2022$ and $2021.$

$(3)$ Prepare ratio analyses $($for $2022,2021,$ and $2020)$ for both companies. You should

include the following ratios in your computations:

Profitability ratios

Gross Profit margin

Profit margin

Return on assets

Return on equity

Productivity

Inventory Turnover

Accounts Receivable Turnover

PPE Turnover

Asset Turnover

Solvency

Debt$-$to$-$equity

Times interest earned

Return on Financial leverage

Liquidity

Current Ratio

Quick Ratio

Operating cash flow to current liabilities

Working capital

$(3)$ Comment on the analytical results of the two companies based on your work in excel.

In addition to contrasting the ratios between the companies, you should interpret the

numbers and make suggestions as to why the ratio of one company might be higher$/$lower

than the other.