Question

Consider the following income statement data from the Ross Company: 2013 2012 Sales revenue $525,000 $450,000...

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 106,000 100,000
Administrative expenses 61,000 55,000
Income tax expense 8,800 6,400


Prepare common-size income statements for each year. Round percentages to one decimal point.

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Answer #1

Prepare common-size income statements for each year. Round percentages to one decimal point.

2013 % 2012 %
Sales revenue 525000 100% 450000 100%
Cost of goods sold 336000 64% 279000 62%
Gross profit 189000 36% 171000 38%
Operating expense
Selling expense 106000 20.2% 100000 22.2%
Administrative expense 61000 11.6% 55000 12.2%
Total operating expense 167000 31.8% 155000 34.4%
Income before tax 22000 4.2% 16000 3.6%
Income tax expense 8800 1.7% 6400 1.4%
Net income 13200 2.5% 9600 2.1%
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