Question

For 2016, Indigo Company initiated a sales promotion campaign that included the expenditure of an additional...

For 2016, Indigo Company initiated a sales promotion campaign that included the expenditure of an additional $39,000 for advertising. At the end of the year, Lumi Neer, the president, is presented with the following condensed comparative income statement:

Indigo Company

Comparative Income Statement

For the Years Ended December 31, 2016 and 2015

1

2016

2015

2

Sales

$940,000.00

$540,000.00

3

Cost of goods sold

338,400.00

205,200.00

4

Gross profit

$601,600.00

$334,800.00

5

Selling expenses

$159,800.00

$81,000.00

6

Administrative expenses

47,000.00

37,800.00

7

Total operating expenses

$206,800.00

$118,800.00

8

Income from operations

$394,800.00

$216,000.00

9

Other income

75,200.00

43,200.00

10

Income before income tax

$470,000.00

$259,200.00

11

Income tax expense

235,000.00

135,000.00

12

Net income

$235,000.00

$124,200.00

Required:
1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round your percentages to one decimal place. Enter all amounts as positive numbers.
2.

To the extent the data permit, comment on the significant relationships revealed by the vertical analysis prepared in (1).

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.

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

$940,000.00

$540,000.00

4

Cost of goods sold

338,400.00

205,200.00

5

Gross profit

$601,600.00

$334,800.00

6

Selling expenses

$159,800.00

$81,000.00

7

Administrative expenses

47,000.00

37,800.00

8

Total operating expenses

$206,800.00

$118,800.00

9

Income from operations

$394,800.00

$216,000.00

10

Other income

75,200.00

43,200.00

11

Income before income tax

$470,000.00

$259,200.00

12

Income tax expense

235,000.00

135,000.00

13

Net income

$235,000.00

$124,200.00

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Vertical Analysis of Income Statement For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included...
Vertical Analysis of Income Statement For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $23,000 for advertising. At the end of the year, Lumi Neer, the president, is presented with the following condensed comparative income statement: Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Sales $812,000 $698,000 Cost of goods sold 365,400 349,000 Gross profit $446,600 $349,000 Selling expenses $162,400 $132,620 Administrative expenses 89,320 90,740...
For 20Y2, Fielder Industries Inc. initiated a sales promotion campaign that included the expenditure of an...
For 20Y2, Fielder Industries Inc. initiated a sales promotion campaign that included the expenditure of an additional $40,000 for advertising. At the end of the year, Leif Grando, the president, is presented with the following condensed comparative income statement: Fielder Industries Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Sales $1,300,000 $1,180,000 Cost of goods sold (682,500) (613,600) Gross profit $617,500 $566,400 Selling expenses $(260,000) $(188,800) Administrative expenses (169,000) (177,000) Total operating expenses...
For 20Y2, Fielder Industries Inc. initiated a sales promotion campaign that included the expenditure of an...
For 20Y2, Fielder Industries Inc. initiated a sales promotion campaign that included the expenditure of an additional $40,000 for advertising. At the end of the year, Leif Grando, the president, is presented with the following condensed comparative income statement: Fielder Industries Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Sales $1,300,000 $1,180,000 Cost of goods sold (682,500) (613,600) Gross profit $617,500 $566,400 Selling expenses $(260,000) $(188,800) Administrative expenses (169,000) (177,000) Total operating expenses...
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...
please show example through Excel Vertical Analysis of Income Statement For 2014, Othere Technology Company initiated...
please show example through Excel Vertical Analysis of Income Statement For 2014, Othere Technology Company initiated a sales promotion campaign that included the expenditure of an additional $15,000 for advertising. At the end of the year, George Wallace, the president, is presented with the following condensed comparative income statement: Othere Technology Company Comparative Income Statement For the Years Ended December 31, 2014 and 2013 2014 2013 Sales $529,240 $455,510 Sales returns and allowances 5,240 4,510 Net sales $524,000 $451,000 Cost...
For 2016, Clapton Company reported a decline in net income. At the end of the year,...
For 2016, Clapton Company reported a decline in net income. At the end of the year, S. Hand, the president, is presented with the following condensed comparative income statement: Clapton Company Comparative Income Statement For the Years Ended December 31, 2016 and 2015 1 2016 2015 2 Sales $6,787,200.00 $6,060,000.00 3 Cost of goods sold 2,444,200.00 2,020,000.00 4 Gross profit $4,343,000.00 $4,040,000.00 5 Selling expenses $1,125,000.00 $900,000.00 6 Administrative expenses 711,200.00 560,000.00 7 Total operating expenses $1,836,200.00 $1,460,000.00 8 Income...
                         Fishing Experiences Comparative             &nbsp
                         Fishing Experiences Comparative                               Income Statement For the Years Ended Decemeber 31, 2014 and 2013           20Y6                          Percent                  20Y5            Percent Sales                      200,000              ?          1 ,000,000                      ? Costs of goods sold   -624,000                ?        -558,000                      ? Gross profit               576,000                   ?         442,000                      ? Selling expenses     -120,000                      ?        -75,000                      ? Administrative expenses -50,000                   ? -50,000            ? Total operating expenses -170,000                 ?              -125,000          ? Income from operations       406,000              ?            317,000              ? Other...
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...
Vertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent...
Vertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows:        Current Year        Previous Year Sales $435,000 $396,000 Cost of goods sold 269,700 221,760 Selling expenses 65,250 71,280 Administrative expenses 73,950 59,400 Income tax expense 8,700 15,840 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. (For...
Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current...
Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous Year Sales $4,000,000 $3,600,000 Cost of goods sold 2,280,000 1,872,000 Selling expenses 600,000 648,000 Administrative expenses 520,000 360,000 Income tax expense 240,000 216,000 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT