Refer to the Fogel Company income statements for the past two years as shown in Exercise 16-24.

Required:

1. Prepare a common-size income statement for year 1 by expressing each line item as a percentage of sales revenue. (Round percentages to the nearest tenth of a percent.)

2. Prepare a common-size income statement for year 2 by expressing each line item as a percentage of sales revenue. (Round percentages to the nearest tenth of a percent.)

Exercise 16-24

Transcribed Image Text:

Fogel Company Income Statements For the Years 1 and 2 Year 2 Year 1 $ 2,000,000 (1,400,000) $ 600,000 $ 1,800,000 (1,200,000) $ 600,000 Sales Less: Cost of goods sold Gross margin Less operating expenses: Selling expenses Administrative expenses Net operating income Less: Interest expense Income before taxes (300,000) (300,000) (100,000) $ 200,000 (50,000) $ 150,000 (110,000) $ 190,000 (40,000) $ 150,000 2$