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Accounting 212

In: Business and Management

Submitted By stemami
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ACCT 212 : Course Project 2 "Learning Objectives : Preparing common-size statements; analyzing profitability; making comparisons with the industry" P13-50A Top managers of O'Hare Products, Inc., have asked for your help in comparing the company’s profit performance and financial position with the average for the industry. The accountant has given you the company’s income statement and balance sheet and also the following data for the industry. The problem is that O'Hare is in dollars and the Industry Average is in percentages. To complete the analysis you will need to convert O'Hare's dollar amounts to percentages. O'Hare Products, Inc. Income Statement Compared with Industry Average Year Ended December 31, 2012 O'Hare "Industry
Average"
Net sales............................................................................... $960,000 100.0% Cost of goods sold.............................................................. 662,400 57.3% Gross profit.......................................................................... 297,600 42.7% Operating expenses ........................................................... 220,800 29.4% Operating income................................................................ 76,800 13.3% Other expenses.................................................................... 9,600 2.5% Net income .......................................................................... $67,200 10.8% O'Hare Products, Inc. Balance Sheet Compared with Industry Average December 31, 2012 O'Hare "Industry
Average"
Current assets...................................................................... $292,000 72.1% Fixed assets, net

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