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Question 1 Comparative statement data for Whispering Company and Metlock Company, two competitors, appear below. All...

Question 1

Comparative statement data for Whispering Company and Metlock Company, two competitors, appear below. All statement of financial position data are as of December 31, 2017, and December 31, 2016.

Whispering Company

Metlock Company

2017

2016

2017

2016
Net sales £1,504,113 £339,668
Cost of goods sold 1,023,277 236,886
Operating expenses 277,402 76,916
Interest expense 7,970 2,320
Income tax expense 61,839 7,410
Plant assets (net) 596,402 £572,775 143,285 £ 128,013
Current assets 408,279 385,366 85,117 81,019
Share capital—ordinary, £5 par 582,000 582,000 140,000 140,000
Retained earnings 253,932 216,973 52,054 44,504
Non-current liabilities 102,775 84,601 15,746 11,897
Current liabilities 65,974 74,567 20,602 12,631

Prepare a vertical analysis of the 2017 income statement data for Whispering Company and Metlock Company in columnar form. (Round percentages to 1 decimal place, e.g. 12.1%. Enter all percentages as positive numbers.)

Compute the return on assets and the return on ordinary shareholders’ equity for both companies. (Round percentages to 1 decimal place, e.g. 12.1%.)

Solutions

Expert Solution

a)Formula spreadsheetb)

formula spreadsheet

jeff jeffy answered 3 months ago
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