Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello

تمرين 11

Outdoor World, Inc., manufactures camping equipment.hown below for the current year are the income statement for the company and a common size summary for the industry in which the company operates.Notice that the percentages in the right-hand column are not for Outdoor World, Inc., but are average percentages for the industry.)

Instructions
a.repare a two-column common size income statement.he first column should show for Outdoor World, Inc., all items expressed as a percentage of net sales.he second column should show the equivalent industry average for the data given in the problem.he purpose of this common size statement is to compare the operating results of Outdoor World, Inc., with the average for the industry.
b.omment specifically on differences between Outdoor World, Inc., and the industry average with respect to gross profit on sales, selling expenses, general and administrative expenses, operating income, net income, and return on assets.uggest possible reasons for the more important disparities.