Question

Exercise 14-6

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Here are the comparative income statements of Delaney Corporation.

Delaney Corporation
Comparative Income Statements
For the Years Ended December 31

2020

2019

Net sales

$684,000

$566,000

Cost of goods sold

535,572

466,384

Gross profit

148,428

99,616

Operating expenses

94,392

53,204

Net income

$ 54,036

$ 46,412

(a)

Prepare a horizontal analysis of the income statement data for Delaney Corporation, using 2019 as a base. (Show the amounts of increase or decrease.) (Enter negative amounts and percentages using either a negative sign preceding the number e.g. -45, -45% or parentheses e.g. (45), (45%). Round percentages to 1 decimal place, e.g. 12.3%.)

DELANEY CORPORATION
Condensed Income Statements

[Entry field with correct answer]

Increase or (Decrease)
During 2020

2020

2019

Amount

Percentage

Net sales

$684,000

$566,000

$

[Entry field with correct answer]

[Entry field with incorrect answer]

%

Cost of goods sold

535,572

466,384

[Entry field with correct answer]

[Entry field with incorrect answer]

%

Gross profit

148,428

99,616

[Entry field with correct answer]

[Entry field with correct answer]

%

Operating expenses

94,392

53,204

[Entry field with correct answer]

[Entry field with incorrect answer]

%

Net income

$54,036

$46,412

$

[Entry field with correct answer]

[Entry field with incorrect answer]

%

(b)

Prepare a vertical analysis of the income statement data for Delaney Corporation for both years. (Round percentages to 1 decimal place, e.g. 12.3%.)

DELANEY CORPORATION
Condensed Income Statements

[Entry field with correct answer]

2020

2019

Amount

Percent

Amount

Percent

Net sales

$684,000

[Entry field with incorrect answer]

%

$566,000

[Entry field with incorrect answer]

%

Cost of goods sold

535,572

[Entry field with incorrect answer]

%

466,384

[Entry field with incorrect answer]

%

Gross profit

148,428

[Entry field with incorrect answer]

%

99,616

[Entry field with incorrect answer]

%

Operating expenses

94,392

[Entry field with incorrect answer]

%

53,204

[Entry field with incorrect answer]

%

Net income

$ 54,036

[Entry field with incorrect answer]

%

$ 46,412

[Entry field with incorrect answer]

%

Answer 1

	DELANEY CORPORATION
	Condensed Income Statements
	For the Years Ended December 31
			Increase or (Decrease)During 2020
	2020	2019	Amount	Percentage
Net sales	684000	566000	118000	20.8%
Cost of goods sold	535572	466384	69188	14.8%
Gross profit	148428	99616	48812	49.0%
Operating expenses	94392	53204	41188	77.4%
Net income	54036	46412	7624	16.4%
2
	DELANEY CORPORATION
	Condensed Income Statements
	For the Years Ended December 31
	2020		2019
	Amount	Percent	Amount	Percent
Net sales	684000	100.0%	566000	100.0%
Cost of goods sold	535572	78.3%	466384	82.4%
Gross profit	148428	21.7%	99616	17.6%
Operating expenses	94392	13.8%	53204	9.4%
Net income	54036	7.9%	46412	8.2%