Financial Statement Notes: Quarterly Data Quarterly data are presented below for Company A and Company B....
Financial Statement Notes: Quarterly Data
Quarterly data are presented below for Company A and Company B. One
of these companies is Gibson Greetings, Inc., which manufactures
and sells greeting cards. The other company is Hon Industries,
Inc., which manufactures and sells office furniture. Both companies
are on a calendar year basis.
| (Amounts in Thousands) | |||||
|---|---|---|---|---|---|
| First Quarter |
Second Quarter |
Third Quarter |
Fourth Quarter |
Year |
|
| Company A | |||||
| Net sales | $186,111 | $177,537 | $203,070 | $213,608 | $780,326 |
| Gross profit | 55,457 | 53,643 | 64,024 | 69,374 | 242,498 |
| Company B | |||||
| Net sales | $84,896 | $83,796 | $142,137 | $235,336 | $546,165 |
| Gross profit | 53,900 | 52,983 | 66,018 | 104,961 | 277,862 |
Required
a. Compute the percent of annual net sales generated each quarter
by Company A. Round to the nearest percent.
b. Compute the percent of annual net sales generated each quarter
by Company B. Round to the nearest percent.
| First Quarter |
Second Quarter |
Third Quarter |
Fourth Quarter |
|
|---|---|---|---|---|
| a. Company A annual net sales percent | ||||
| b. Company B annual net sales percent |
c. Which company has the most seasonal business?
Company A or Company B
d. Which Company is Gibson Greetings?
Company A or Company B
Which Company is Hon Industries, Inc.?
Company A or Company B
e. Which company's interim quarterly data are probably most useful
for predicting annual results?
Company A or Company B
Homework Answers
| a | ||||
| First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |
| a. Company A annual net sales percent | 24% | 23% | 26% | 27% |
| b. Company B annual net sales percent | 16% | 15% | 26% | 43% |
| b | ||||
| Company B has the most seasonal business. | ||||
| c | ||||
| Company B is Gibson Greetings | ||||
| d | ||||
| Company A is Hon Industries, Inc. | ||||
| e | ||||
| Company A quarterly data is most useful for predicting annual results | ||||
| Workings for a and b | ||||
| First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |
| a. Company A annual net sales percent | =186111/780326 | =177537/780326 | =203070/780326 | =213608/780326 |
| b. Company B annual net sales percent | =84896/546165 | =83796/546165 | =142137/546165 | =235336/546165 |
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