Using Excel sheet create two financial statements; the Income Statement and the Balance Sheet. Next, will use vertical analysis (common sized financial statements and calculate the ratios/measurements listed below for both years. The ratios should be labeled and numbered one through ten. Make sure that dollar signs are used where appropriate, and that other markings such as percent signs are also applied when needed. You will need to calculate ending Retained Earnings balance for the current year.

Calculate to the second decimal place the following: Working Capital, Current Ratio, Acid-test Ratio, Accounts Receivable Turnover, Average Collection Period, Inventory Turnover, Debt-to-Equity Ratio, Gross Margin Percentage, Net Profit Margin Percentage, and Return on Assets.

Your solution (Excel workbook) will need to have an input sheet. This sheet will have the given input data that is found on the preceding page. Numerical data in the other sheets will be fed from this input data.

The second sheet will contain your balance sheet, income statement, and ratios. On this sheet present the financial statements in dollars and in common-sized format (vertical analysis). On this sheet you will provide the first pages asked for ratios: Working Capital, Current Ratio, Acid-test Ratio, Accounts Receivable Turnover, Average Collection Period, Inventory Turnover, Debt-to-Equity Ratio, Gross Margin Percentage, Net Profit Margin Percentage, and Return on Assets.

The dollar amounts are for this year and last year, respectively :

Accounts Payable; $3,360 and $2,160

Accounts Receivable, net; $1,898 and $1,600 Bonds; $75,000 and $75,000

Cash; $2,593 and $1,260

Common Stock, $1 par; $5,900 and $5,000

Cost of Goods Sold; $12,600 and $9,900

Income Tax rate; 27% and 30%

Interest Expense; $792 and $780

Inventory; $9,300 and $7,200

Marketable Securities; $3,260 and $4,300

Plant, Property, & Equipment, net; $69,300 and $68,940

Prepaid expenses; $200 and $480

Retained Earnings; $1,891 and $1,320

Sales; $15,598 and $12,480

Selling & Administrative expenses; $1,590 and $1,560

Wages Payable; $400 and $300