Financial Analysis Activity Comparative statement data for P Company and Q Company-competitors-appear on the following page. P Company Q Company 2003 2002 2003 2002 Net sales $100,000 30,000 15,000 1,000 400 1,000 S80,000 30,000 20,000 1,500 Gross profit Operating expenses Amortization expense Interest expense Income tax expense 500 2,000 6,000 Net income 12,600 1,000 10,000 40,000 1,000 11,000 30,000 110,000 92,000 10,000 40,000 10,000 Cash 4,000 24,000 8,000 20,000 4,000 28,000 1,000 23,000 Accounts receivable Other current assets 22,000 7,000 Capital assets (net) Current liabilities 62,600 30,000 21,000 40,000 22,600 21,000 5,000 27,000 1,000 17,000 Long-term liabilities Common stock Retained earnings Instructions (a) Prepare a vertical analysis of the 2003 income statement data for P and Q. (b) Compute the return on common shareholders' equity for both companies for 2003. (c) Compare receivable collections between the two companies for 2003. (d) Compare the short-term liquidity of the two companies for 2003.

ancial Statements Nataro, Incorporated, has sales of $676,000, costs of $338,000, depreciation expense of $82,000, interest expense of $51,000, and a tax rate of 24 percent. What is the net income for this firm? (Do not round intermediate calculations.) Net income

Vertical analysis The following income statement data for AT&T Inc. and Verizon Communications Inc. were taken from their recent annual reports (in millions):   AT&T Verizon Revenues $132,447 $127,079 Cost of services (expense) 60,611 49,931 Selling and marketing expense 39,697 41,016 Depreciation and other expenses 20,393 16,533 Operating income $ 11,746 $ 19,599 Required: a. Prepare a vertical analysis of the income statement for AT&T. Round to one decimal place. AT&T Income Statement     Amount Percent Revenues     Cost of services (expense)     Selling and marketing expense     Depreciation and other expenses     Operating income     b. Prepare a vertical analysis of the income statement for Verizon. Round to one decimal place. Verizon Income Statement     Amount Percent Revenues     Cost of services (expense)     Selling and marketing expense     Depreciation and other expenses     Operating…

Trend Analysis Critelli Company has provided the following comparative information:       Year 5     Year 4     Year 3     Year 2     Year 1 Net income $940,300   $810,600   $681,200   $582,200   $493,400   Interest expense 319,700   291,800   252,000   192,100   153,000   Income tax expense 300,896   226,968   190,736   151,372   118,416   Average total assets 5,779,817   5,103,704   4,360,748   3,704,785   3,153,171   Average stockholders' equity 1,975,420   1,769,869   1,548,182   1,373,113   1,203,415     You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following levels for the last five years:     Industry Ratios Return on total assets 21.5 %   Return on stockholders’ equity 44.4 %   Times interest earned 4.6     Instructions: Calculate three ratios for Year 1 through Year 5. Round to one decimal place. a.  Return on total assets: Year 5…