Fundamentals of Financial Accounting 4th Edition by Fred Phillips,Robert Libby,Patricia Libby

Exercise 91

Analyzing Gross Profit Percentage on the Basis of an Income Statement
Wolverine World Wide Inc. prides itself as being the "world's leading marketer of U.S. branded non-athletic footwear." The following data (in millions) were taken from its annual report for the fiscal year ended January 1, 2011:

Required:
1. Based on these data, prepare a multistep income statement.
2. How much was the gross profit What was the gross profit percentage (Round to the nearest tenth of a percent.) Explain what these two amounts mean.
3. Evaluate the results in light of the company's 39.8% gross profit percentage in the prior year.
4. Compare Wolverine's gross profit percentage to Walmart 's average gross profit percentage of 24.79b. From this information, can you determine which company is more successful Why or why not