The comparative financial statements for CyberOptic Corporation are in the Working Papers. The financial statements have been completed up to the comparative analysis section.

Instructions:

1. Complete the following comparative financial statements using component percentage analysis. Round percentage calculations to the nearest 0.1%.

a. Comparative income statement

b. Comparative stockholders’ equity statement

c. Comparative balance sheet 

2. Use the financial statements’ component percentage analysis to determine whether the current year’s results for the following items, compared with those for the prior year, appear to be favorable or unfavorable.

Give reasons for your responses.

a. As a percentage of net sales:

(1) Cost of merchandise sold

(2) Gross profit on operations

(3) Total operating expenses

(4) Net income after federal income tax

b. As a percentage of total stockholders’ equity:

(1) Retained earnings

(2) Capital stock

c. As a percentage of total assets or total liabilities and stockholders’ equity:

(1) Current assets 

(2) Current liabilities