Common-Size Income Statements
Consider the following income statement data from the Ross
Company:
2013
2012
Sales...
Common-Size Income Statements
Consider the following income statement data from the Ross
Company:
2013
2012
Sales revenue
$525,000
$450,000
Cost of goods sold
336,000
279,000
Selling expenses
107,000
101,000
Administrative expenses
62,000
56,000
Income tax expense
9,800
7,400
Prepare common-size income statements for each year.
Note: Round answers to one
decimal place (ex: 0.2345 = 23.5%).
ROSS COMPANY
Common-Size Income Statements
(Percent of Sales Revenue)
2013
2012
Sales Revenue
Answer
Answer
Cost of Goods Sold
Answer
Answer
Gross Profit on...
Income statements for
Finch Company for 2018 and 2019 follow:
FINCH COMPANY
Income Statements
2019
2018...
Income statements for
Finch Company for 2018 and 2019 follow:
FINCH COMPANY
Income Statements
2019
2018
Sales
$
200,400
$
180,400
Cost of goods
sold
142,200
120,200
Selling
expenses
21,700
19,700
Administrative
expenses
13,000
15,000
Interest
expense
3,500
5,500
Total
expenses
$
180,400
$
160,400
Income before
taxes
20,000
20,000
Income taxes
expense
6,000
3,900
Net income
$
14,000
$
16,100
Required
Perform a horizontal
analysis, showing the percentage change in each income statement
component between 2018 and 2019.
Perform...
Prepare a common-size income statement (component percentages)
for the following income statement.
Dollar Amount
Sales revenue...
Prepare a common-size income statement (component percentages)
for the following income statement.
Dollar Amount
Sales revenue
$200,000
Cost of goods sold
$80,000
Gross profit
$120,000
Operating expenses
$101,000
Interest expense
$4,000
Income before income tax
$15,000
Income tax expense (rate 20%)
$3,000
Net income
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd.
Comparative Income Statement
This Year
Last Year
Sales
$
7,390,000
$
5,616,400
Cost of goods sold
4,730,000
3,506,500
Gross margin
2,660,000
2,109,900
Selling and administrative expenses:
Selling expenses
1,382,000
1,076,000
Administrative expenses
710,500
612,000
Total expenses
2,092,500
1,688,000
Net operating income
567,500
421,900
Interest expense
100,000
87,000
Net income before taxes
$
467,500
$
334,900
Required: 1. Express each year's income statement in common-size...
Rate of Change Analyses
Teicher Company presents the following condensed comparative
income statements for 2020, 2019,...
Rate of Change Analyses
Teicher Company presents the following condensed comparative
income statements for 2020, 2019, and 2018:
For Years Ended December 31,
2020
2019
2018
Sales (net)
$120,000
$100,000
$85,000
Cost of goods sold
(72,000)
(55,000)
(45,000)
Gross profit
$48,000
$45,000
$40,000
Operating expenses
(22,000)
(20,000)
(18,000)
Operating income
$26,000
$25,000
$22,000
Other items:
Dividend revenue
400
500
200
Interest expense
(1,200)
(1,000)
(500)
Income before income taxes
$25,200
$24,500
$21,700
Income tax expense
(8,200)
(8,000)
(6,000)
Net income...
Horizontal Analysis of the Income Statement
Income statement data for Winthrop Company for two recent years...
Horizontal Analysis of the Income Statement
Income statement data for Winthrop Company for two recent years
ended December 31, are as follows:
Current
Year
Previous
Year
Sales
$550,000
$440,000
Cost of goods sold
467,400
380,000
Gross profit
$82,600
$60,000
Selling expenses
$24,150
$21,000
Administrative expenses
20,910
17,000
Total operating expenses
$45,060
$38,000
Income before income tax
$37,540
$22,000
Income tax expenses
15,000
8,800
Net income
$22,540
$13,200
a. Prepare a comparative income statement with
horizontal analysis, indicating the increase (decrease)...
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd.
Comparative Income Statement
This Year
Last Year
Sales
$
7,390,000
$
5,616,400
Cost of goods sold
4,770,000
3,506,500
Gross margin
2,620,000
2,109,900
Selling and administrative expenses:
Selling expenses
1,384,000
1,078,500
Administrative
expenses
708,500
614,000
Total expenses
2,092,500
1,692,500
Net operating income
527,500
\417,400\
Interest expense
104,000
87,000
Net income before taxes
$
423,500
$
\330,400\
Members of the company’s board of
directors...
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto: McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto: McKenzie Sales, Ltd. Comparative Income
Statement This Year Last Year Sales $ 7,320,000 $ 5,563,200 Cost of
goods sold 4,690,000 3,513,500 Gross margin 2,630,000 2,049,700
Selling and administrative expenses: Selling expenses 1,399,000
1,073,500 Administrative expenses 707,500 610,000 Total expenses
2,106,500 1,683,500 Net operating income 523,500 366,200 Interest
expense 105,000 89,000 Net income before taxes $ 418,500 $ 277,200
This Year Last Year Sales % % Cost of...
Vertical Analysis of Income Statement
Revenue and expense data for Rogan Technologies Co. are as
follows:...
Vertical Analysis of Income Statement
Revenue and expense data for Rogan Technologies Co. are as
follows:
20Y8
20Y7
Sales
$599,000
$539,000
Cost of goods sold
353,410
291,060
Selling expenses
95,840
97,020
Administrative expenses
107,820
118,580
Income tax expense
23,960
10,780
a. Prepare an income statement in comparative
form, stating each item for both 20Y8 and 20Y7 as a percent of
sales. If required, round percentages to one decimal place. Enter
all amounts as a positive number.
Rogan Technologies Co.
Comparative...
Horizontal Analysis of the Income Statement
Income statement data for Boone Company for the years ended...
Horizontal Analysis of the Income Statement
Income statement data for Boone Company for the years ended
December 31, 20Y5 and 20Y4, are as follows:
20Y5
20Y4
Sales
$487,500
$390,000
Cost of goods sold
(414,800)
(340,000)
Gross profit
$72,700
$50,000
Selling expenses
$(20,700)
$(18,000)
Administrative expenses
(18,450)
(15,000)
Total operating expenses
$(39,150)
$(33,000)
Income before income tax
$33,550
$17,000
Income tax expenses
(13,400)
(6,800)
Net income
$20,150
$10,200
a. Prepare a comparative income statement with
horizontal analysis, indicating the increase (decrease)...