Comparative statement data for P Company and Q Company (competitors) follow. All balance sheet data are as of December 31, 2002 and December 31, 2001.
|P Company||Q Company|
|Income tax expense||1,000||2,000|
|Other current assets||40,000||30,000||8,000||7,000|
|Capital assets (net)||62,600||110,000||20,000||21,000|
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.