Common size statements, ROI, ROE
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Instructions
(a) Prepare a vertical analysis of the 2009 income statement data for Douglas Company and Maulder Company in columnar form.
Net income (Douglas) 6.6%; (Maulder) 3.0%
(b) Comment on the relative profitability of the companies by computing the return on assets and the return on common stockholders' equity ratios for both companies.
Please see the attachment to complete problem and balance sheets.
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Solution Summary
The solution contains preparation of common size income statements and Balance sheets and also computation of ROI and ROE of two companies to analyse the relative profitability.
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