Questions 1-5:

1. Prepare common-sized balance sheets and income statements for Just for Feet for the period 1996-1998. Also compute key liquidity, solvency, activity, and profitability ratios for 1997-1998. Given these data, comment on what you believe were the high-risk financial statement items for the 1998 Just for Feet Audit.

1998

1997

1996

1998

1997

1996

Cash

12,412

82,490

138,785

1.8%

18.4%

36.9%

Marketing

33,961

9.0%

Accounts Rec

18,875

15,840

6,553

2.7%

3.5%

1.7%

Inventory

399,901

206,128

133,323

58.0%

46.0%

35.5%

Other current

18,302

6,709

2,121

2.7%

1.5%

0.6%

Total Current

449,490

311,167

314,743

65.2%

69.4%

83.7%

Plant, Property, Equip

160,592

94,529

54,922

23.3%

21.1%

14.6%

Goodwill

71,084

36,106

10.3%

8.1%

0.0%

other LT

8,230

6,550

6,169

1.2%...