Question

In: Accounting

2. Look at the last five(omit 2020 Q2) quarters covered in the table. Compare the most...

2. Look at the last five(omit 2020 Q2) quarters covered in the table. Compare the most recent quarter to the same quarter in the previous year.

a) Which sector* had the largest percentage increase in profit (or largest decrease in loss)

b) Which sector had the smallest percentage increase in profit (or the largest percentage decrease in profit)?

c) Which sectors*, if any, experienced losses during any of the last four quarters covered in the table?

*Note: By "sector", I mean certain groups larger than an individual industry: These are: “Financial” (Row 10), “Utilities (Row 14), "Manufacturing" (Row 15), "Durable goods" (Row 16), "Nondurable goods" (Row 23) and Rows 28 through 32. The listings in Rows 17 through 22 and 24 through 27 (the rows which are most indented from the left margin) are industries, not sectors.

Line 2018 2019 2020
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1         Corporate profits with inventory valuation and capital consumption adjustments 2206 2225.3 2258.1 2282.5 2181.2 2263.2 2246.5 2311.3 2035 1808.2
2 Domestic industries 1670 1712.6 1765.6 1773.5 1696.8 1756.9 1731.9 1794.6 1561.9 1431.3
3     Financial1 428.7 426 420.8 420.8 454.2 463.8 456.8 473.4 431.2 470.7
4     Nonfinancial 1241.3 1286.7 1344.8 1352.7 1242.6 1293.2 1275.2 1321.2 1130.7 960.6
5 Rest of the world 536 512.7 492.5 509 484.4 506.2 514.5 516.6 473.1 376.9
6     Receipts from the rest of the world 858.2 879 848.2 879.6 847.2 879.4 877.3 880.8 790.5 650.9
7     Less: Payments to the rest of the world 322.2 366.3 355.7 370.6 362.8 373.2 362.7 364.2 317.4 274
8         Corporate profits with inventory valuation adjustment 2088.9 2112.5 2149.9 2176.8 2154.9 2246.4 2231.7 2294.9 2053.5 1826.9
9 Domestic industries 1552.9 1599.8 1657.4 1667.8 1670.5 1740.2 1717.2 1778.3 1580.4 1450
10     Financial 423.2 419.6 414.6 415.3 460.1 472.3 466.7 482.9 444.7 484.1
11         Federal Reserve banks 73.7 70.5 66.9 61 53 56.6 50.7 49.4 68.5 64.9
12         Other financial2 349.5 349.1 347.6 354.3 407.1 415.8 416 433.5 376.2 419.2
13     Nonfinancial 1129.7 1180.2 1242.8 1252.5 1210.4 1267.8 1250.5 1295.4 1135.7 966
14         Utilities 22.7 23.3 22.3 18.6 26.2 28.2 27.1 27.3 22.5 ---
15         Manufacturing 276.2 348.1 365.3 360.9 324.5 344.9 341 335.7 302.2 ---
16             Durable goods 147.6 183.9 187.3 164.9 188 193.1 174.2 170.1 157.8 ---
17                 Fabricated metal products 20.7 19.3 19.7 19.6 25.7 25.3 23.9 24.2 23 ---
18                 Machinery 16.6 22.3 18.8 18.3 22.9 29.6 27.1 26.1 20.9 ---
19                 Computer and electronic products 44.5 58.2 61.3 54 56.3 50.4 45.4 51.3 54.7 ---
20                 Electrical equipment, appliances, and components 12.3 11.8 11.2 8.3 10.4 12 12.5 10.9 7.9 ---
21                 Motor vehicles, bodies and trailers, and parts 0 0.1 5.8 -2.1 1.9 2.1 0.2 -2.1 -1.1 ---
22                 Other durable goods3 53.5 72.2 70.6 66.8 70.8 73.7 65.2 59.7 52.4 ---
23             Nondurable goods 128.5 164.2 178 196 136.6 151.8 166.8 165.6 144.4 ---
24                 Food and beverage and tobacco products 48.4 52.9 51.8 37.2 45.7 47.8 51.6 48 50.4 ---
25                 Petroleum and coal products 13.8 21.3 29.6 59.2 6.2 16.2 21.7 25.8 15.9 ---
26                 Chemical products 41.6 62.4 67.1 72.5 55.9 57.2 61.3 58.8 57 ---
27                 Other nondurable goods4 24.7 27.7 29.6 27.1 28.8 30.6 32.2 33.1 21.2 ---
28         Wholesale trade 111.3 94.9 103.9 112.9 103.9 110.5 113.4 117.4 108.3 ---
29         Retail trade 149.5 137.7 157.5 141.2 155.5 165.6 166.8 184.2 167.1 ---
30         Transportation and warehousing 48.5 46.6 52 64.2 54.7 54.4 59.5 57 37.8 ---
31         Information 134.9 143.4 144 134.6 136.2 140 108.4 138.7 126.7 ---
32         Other nonfinancial5 386.7 386.2 397.8 420.1 409.4 424.3 434.3 435.1 371 ---
33 Rest of the world 536 512.7 492.5 509 484.4 506.2 514.5 516.6 473.1 376.9

Solutions

Expert Solution

Please note that most recent quarter needs to be compared to the same quarter in previous year. Also it has been stated to omit 2020 Q2. So latest quarter is Q1 of 2020 which needs to be compared with Q1 of 2019 (previous year has been stated and not previous years so we will not coapre 2018). Keeping this in mind, answers are to be given.

a) Retail trade had largest percentage increase in profit.

b) Transportation and warehousing sector had the smallest percentage increase in profit or largest percentage decrease in profit.

c) No sector has experienced losses during any of the last four quarters covered in table.

Notes :

1.  Profit/loss increase /decrease in % =(2020 Q1 -2019 Q1 divided by 2019 Q1)

2019 2020
Q1 Q1
1     Financial 460.1 444.7
% increse/decrease in profit/loss -3.35%
2         Utilities 26.2 22.5
% increse/decrease in profit/loss -14.12%
3         Manufacturing 324.5 302.2
% increse/decrease in profit/loss -6.87%
3             Durable goods 188 157.8
% increse/decrease in profit/loss -16.06%
4             Nondurable goods 136.6 144.4
% increse/decrease in profit/loss 5.71%
5         Wholesale trade 103.9 108.3
% increse/decrease in profit/loss 4.23%
6         Retail trade 155.5 167.1
% increse/decrease in profit/loss 7.46%
7         Transportation and warehousing 54.7 37.8
% increse/decrease in profit/loss -30.90%
8         Information 136.2 126.7
% increse/decrease in profit/loss -6.98%
9         Other nonfinancial5 409.4 371
% increse/decrease in profit/loss -9.38%

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