3. Using the data provided in Table 1, prepare common size income statements usingrevenues and cost-of-goods-sold in the original S-1 and amended S-1. Analyze trends ofexpenses as a percentage of revenue for 2009 and 2010. Compare and contrast thefollowing ratios:a. Gross Margin Percentage;b. Asset Turnover Ratio. TABLE 1Abridged Income Statements for Groupon20092010Income Statement AccountGrossNetGrossNetRevenue$30.4 M$14.5 M$713.4 M$312.9 MCost of Sales19.5 M4.4 M433.4 M32.5 M280.0 MGross MarginMarketing ExpenseGeneral and Admin. ExpenseOther Expenses10.9 M10.1 M280.4 M4.6 M4.9 M263.2 M284.3 M7.5 M6.4 M233.9 M213.3 M203.2 M203.2 MNet Loss1.34 M1.09 M413.4 M420.1 MNet Loss to common sharcholders6.92 M6.92 M456.3 M456.3 MEPS (Basic)(0.04)(0.04)(2.66)(2.66)This information was obtained from Groupon's S-1 filing with the SEC on June 2, 2011, and the amended filing(Amendment No. 4) on October 7, 2011.

Common size income statement analyse every item of income statement as a percentage of sales. This…

Answered: Using the da

Business

Accounting

Using the da

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: On the Income Statement, how is Operating Income typically calculated? A. Revenue (Cost of Goods…

A: The income statement, also known as the profit and loss statement, is one of the main financial…

Q: A) Calculate the total Current Assets, Total Assets, Total Liabilities and Equity, Gross profit,…

A: The common-sized financial statements are statements where the items are represented in the form of…

Q: Please help: options for matching answers are trend analysis, vertical analysis, retained analysis…

A: Assets, liabilities and equity are three important component of accounting equation. After each and…

Q: For the highlighted in yellow portions what are the Excel formulaes used to calculate ratios?

A: 1. Current ratio: The current ratio estimates a firm's capacity of paying short-term or current…

Q: The ratio that tells you how much income is used up by expenses is the Return on Assets ratio. True…

A: A financial ratio called return on assets (ROA) describes how lucrative a business is in comparison…

Q: Required: Compute the following: (For Requirements 1 to 4, enter your percentage answers rounded to…

A: As per Bartleby Honor Code, when a question with multiple sub-parts has been asked, the expert is…

Q: GIVE AN INTERPRETATION OF THESE RATIOS CONCLUSIVELY Acid test ratio = (total current asset –…

A: After calculating the required ratios it is very important to interpret the results of it.

Q: The current year financial statements for Blue Water Company and Prime Fish Company are presented…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Use for financial statements for Yellow Hammer to answer problems 1-3 L. Assess Yellow Hammer's…

A: 1) EBITDA - Earnings Before Interest ,Taxes, Depreciation & Amortization. Particulars Year…

Q: a. Prepare a comparative income statement with horizontal analysis, indicating the increase…

A: Horizontal Analysis Horizontal analysis refers to the measurement of percentage change in the…

Q: A multistep income statement divides revenues and expenses further to show. Select one: a. subtotals…

A: An income statement that categorizes incomes and expenses into operational and non-operating heads…

Q: A In the single-step income statement: O just two groupings exist - revenues and expenses O expenses…

A: Lets understand the basics.Income statement can be prepared using two formats which are,(1) Single…

Q: Return on assets

A: Return on assets is computed as net income upon total assets of the company.

Q: In horizontal analysis, each item is expressed as a percentage of the O a. latest year figure. O b.…

A: Lets understand the basics.Balance sheet analysis gets divided into main two types which are,(1)…

Q: a. What is your company’s primary revenue, secondary revenue, and gains? b. What is your company’s…

A: As per guidelines. we can only answer up to 3 subparts. Kindly corporate and ask other subparts as a…

Q: Use the attached information to complete the ratio analysis. The Ratio Analysis is for…

A: Ratio analysis is useful to measure the financial performance of the company and helpful to make…

Q: On the multiple-step income statement, which of the following would be the least likely to be found…

A: Other losses and incomes head in the multistep income statement shows all the expenses and revenues…

Q: Indicate the effect of the transactions listed in the following table on total current assets,…

A: Federal income tax due is paid: Liability due is paid which results cash outflow. Here, liability is…

Q: Indicate the effect of the transactions listed in the following table on total current assets,…

A: Payment is made to trade creditors for previous purchases: Here, payment to creditors is made.…

Q: Which of the following expenses is usually listed last on the income statement? a. Advertising…

A: The income statement is one of the financial statements of the business. It tells about the…

Q: The accounting records of Wall's China Shop reflected the following balances as of January 1, Year…

A: Inventory can be valued using various methods -First-in First-Out Method - Under the First-in…

Q: Indicate the effect of the transactions listed in the following table on total current assets,…

A: Entry for Merchandise sold for cash is : Cash a/c Dr XXX To Sales a/c Cr XXX

Q: Preparing an income statement) Prepare an income statement and a common-sized income statement from…

A: The income statement is one of the financial statements of the business. It records the revenue and…

Question

3. Using the data provided in Table 1, prepare common size income statements using

revenues and cost-of-goods-sold in the original S-1 and amended S-1. Analyze trends of

expenses as a percentage of revenue for 2009 and 2010. Compare and contrast the

following ratios:

a. Gross Margin Percentage;

b. Asset Turnover Ratio.

TABLE 1
Abridged Income Statements for Groupon
2009
2010
Income Statement Account
Gross
Net
Gross
Net
Revenue
$30.4 M
$14.5 M
$713.4 M
$312.9 M
Cost of Sales
19.5 M
4.4 M
433.4 M
32.5 M
280.0 M
Gross Margin
Marketing Expense
General and Admin. Expense
Other Expenses
10.9 M
10.1 M
280.4 M
4.6 M
4.9 M
263.2 M
284.3 M
7.5 M
6.4 M
233.9 M
213.3 M
203.2 M
203.2 M
Net Loss
1.34 M
1.09 M
413.4 M
420.1 M
Net Loss to common sharcholders
6.92 M
6.92 M
456.3 M
456.3 M
EPS (Basic)
(0.04)
(0.04)
(2.66)
(2.66)
This information was obtained from Groupon's S-1 filing with the SEC on June 2, 2011, and the amended filing
(Amendment No. 4) on October 7, 2011.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

Which is the CORRECT order for items to appear on the income statement? Group of answer choices sales revenue, gross profit, net income, operating expenses cash, accounts receivable, inventory, property/plant/equipment, intangible assets sales revenue, operating expenses, gross profit, net income sales revenue, cost of goods sold, gross profit, operating expenses sales revenue, gross profit, cost of goods sold, operating expenses
Compute the cost of goods sold and ending inventory, assuming (1) FIFO cost flow, (2) LIFO cost flow, and (3) weighted-average cost flow. Then, compute the income tax expense for each method. Use a vertical model to show the 2018 income statement, balance sheet, and statement of cash flows under FIFO, LIFO, and weighted average. (Hint: Record the events under an accounting equation before preparing the statements.)
which comes first when preparing a income statement? please put in order salaries expense cost of goods sold net income total expenses gross profit miscellsneous expense sales
In a multiple-step income statement, the dollar amount for income from operations is always the same as net income. Please explain with full explanation a. True b. False
The amount found in the Income Statement debit column on the worksheet for Income Summary is the: A.ending inventory. B.beginning inventory. C.total amount of expenses. D.total amount of revenues.
On a multiple step income statement, the account interest expense would be located under A) Net sales B) COGS C) Other Revenues and expenses
Other income is a. added to operating income. b. deducted from operating income. c. added to gross profit. d. deducted from sales.
Need the answers in that formats thank you
How do I set this up? This is a few questions stuck together. Count as multiple questions I think. 4-12 Indicate the effect of the transactions listed in the following table on total current assets, current ration, and net income. Use (+) to indicate an increase, (-) to indicate a decrease, and (0) to indicate either no effect or an indeterminate effect. Be prepared to state any necessary assumptions and assume an initial current ratio of more than 1.0. Table for 4-12 Total Current Assets Current Ratio Effect on Net Income a Cash is acquired through issuance of additional stock. b Merchandise is sold for cash. c Federal income tax due for the previous year is paid. d A fixed asset is sold for less than book value. e A fixed asset is sold for more than book value. f Merchandise is sold on credit. g Payment is made to…