Find the Net Sales and Cost of Goods between Eastman Kodak Company and Canon Inc

Question

Find the Net Sales and Cost of Goods between Eastman Kodak Company and Canon Inc in 2012 and the profit they were making? Also, what type of inventory system (perpetual or periodic) do you think each company uses and why? Using the information from the financial statements for each company, calculate the gross margin ratio (aka gross profit ratio) and discuss how the ratios compare and what this may mean for each company. Using the information from the financial statements for each company, calculate the acid test ratio and discuss how the ratios compare and what this may mean for each company. Review the financial statements and footnotes for each company to determine how they handle the reporting of sales discounts.

Explanation / Answer

kodak Net sales totaled $6.02 billion, down 16 percent from $7.17 billion in 2010.The company finished the year with $861 million in cash, down from $1.6 billion a year earlier. Canon Net sales for the nine months ended September 30, 2012 totaledU.S.$32,415 million, a year-on-year decrease of 2.5%. Despite the positive effects of ongoing cost-cutting efforts, the gross profit ratio for the third quarter declined by 1.1 points to 48.3% from the year-ago period due to the significant impact of the strong yen and product mix. The gross profit ratio for the first nine months of the year also declined by 1.1 points to 48.2%

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