Wood Work Inc. and Modern Furniture Ltd. are two large home furnishing retailers, selling a wide range
Question:
Wood Work Inc. and Modern Furniture Ltd. are two large home furnishing retailers, selling a wide range of furniture, major appliances, and home electronics. The following data were taken from recent annual reports of both companies (amounts in thousands of Canadian dollars):
| Wood work | Modern furniture |
|
|
Sales revenue | 1,542,000 | 782,303 |
|
|
Income tax expense | 15,489 | 17,201 |
|
|
Cash dividends declared | 2,743 | 28,347 |
|
|
Operating expenses | 561,897 | 273,126 |
|
|
Cost of sales | 798,747 | 449,404 |
|
|
Finance expense (income), net | 44,772 | (5,850 | ) |
|
Other income | 2,617 | - |
|
|
Number of common shares outstanding (in millions) | 122.8 | 80.0 |
|
|
|
|
|
|
|
Required:
1. Based on these data, prepare a multiple-step statement of earnings for each company for the current year ended December 31 (showing both gross profit and earnings from operations). (Negative answers should be indicated by a minus sign. Enter your answers in thousands of Canadian dollars except "No. of shares" which should be entered in million rounded to 1 decimal place. Round "Earnings per share" to 2 decimal places.)
2. Compute the gross profit and the gross profit percentage for each company. (Enter "Gross Profit" answers in thousands of Canadian dollars. Round percentage answers to 1 decimal place (i.e., 0.124 should be entered as 12.4).)
Financial Accounting
ISBN: 978-1259103285
5th Canadian edition
Authors: Robert Libby, Patricia Libby, Daniel Short, George Kanaan, M