Question

Problem 17-2A Ratios, common-size statements, and trend percents LO P1, P2, P3 [The following information applies to the questions displayed below.] Selected comparative financial statements of Korbin Company follow: KORBIN COMPANY Comparative Income Statements For Years Ended December 31, 2017, 2016, and 2015 2017 2016 2015 Sales $505,425 $387,197 $268,700 Cost of goods sold 304,266 243,547 171,968 Gross profit 201,159 143,650 96,732 Selling expenses 71,770 53,433 35,468 Administrative expenses 45,488 34,073 22,302 Total expenses 117,258 87,506 57,770 Income before taxes 83,901 56,144 38,962 Income taxes 15,606 11,510 7,909 Net income $68,295 $44,634 $31,053 KORBIN COMPANY Comparative Balance Sheets December 31, 2017, 2016, and 2015 2017 2016 2015 Assets Current assets $53,242 $41,655 $55,684 Long-term investments 0 500 3,340 Plant assets, net 97,372 104,097 62,146 Total assets $150,614 $146,252 $121,170 Liabilities and Equity Current liabilities $21,990 $21,792 $21,205 Common stock 72,000 72,000 54,000 Other paid-in capital 9,000 9,000 6,000 Retained earnings 47,624 43,460 39,965 Total liabilities and equity $150,614 $146,252 $121,170 Problem 17-2A Part 2 2. Complete the below table to calculate income statement data in common-size percents. (Round your percentage answers to 2 decimal places.)

Answer 1

2
KORBIN COMPANY
Common-Size Comparative Income Statements
For Years Ended December 31, 2017, 2016, and 2015
	2017	2016	2015
Sales	100.00%	100.00%	100.00%
Cost of goods sold	60.20%	62.90%	64.00%
Gross profit	39.80%	37.10%	36.00%
Selling expenses	14.20%	13.80%	13.20%
Administrative expenses	9.00%	8.80%	8.30%
Total expenses	23.20%	22.60%	21.50%
Income before taxes	16.60%	14.50%	14.50%
Income taxes	3.09%	2.97%	2.94%
Net income	13.51%	11.53%	11.56%