Question

1. Prepare an income statement in comparative form, stating each item for both years as a...

1. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. Round your percentages to one decimal place. Enter all amounts as positive numbers. Question not attempted. Score: 0/76 Indigo Company Comparative Income Statement For the Years Ended December 31, 2016 and 2015 1 2016 2016 2015 2015 2 Amount Percent Amount Percent 3 Sales $890,000.00 $600,000.00 4 Cost of goods sold 320,400.00 228,000.00 5 Gross profit $569,600.00 $372,000.00 6 Selling expenses $142,400.00 $84,000.00 7 Administrative expenses 62,300.00 54,000.00 8 Total operating expenses $204,700.00 $138,000.00 9 Income from operations $364,900.00 $234,000.00 10 Other income 80,100.00 54,000.00 11 Income before income tax $445,000.00 $288,000.00 12 Income tax expense 231,400.00 156,000.00 13 Net income $213,600.00 $132,000.00

Homework Answers

Answer #1

Indigo Company

Comparative Income Statement

For the Years Ended December 31, 2016 and 2015

2016

2015

Amount

%

Amount

%

Sales

890000

100.0%

600000

100.0%

Cost of goods Sold

320400

36.0%

228000

38.0%

Gross profit

569600

64.0%

372000

62.0%

Selling expenses

142400

16.0%

84000

14.0%

Administrative expenses

62300

7.0%

54000

9.0%

Total operating expenses

204700

23.0%

138000

23.0%

Income from operations

364900

41.0%

234000

39.0%

Other income

80100

9.0%

54000

9.0%

Income before income tax

445000

50.0%

288000

48.0%

To calculate percentage, the amount of each item of respective is year is divided by the sales of respective year

For example

Percentage of gross profit in 2016 = gross profit in 2016 / sales in 2016 = 569600/890000 = 64.0%

Percentage of gross profit in 2015 = gross profit in 2015 / sales in 2015 = 372000/600000 = 62.0%

In the same way it is calculated for all items for both years.

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