Presented below is the comparative income statement of Edison Company for 2019 and 2018. Edison Company Income
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Question:
Presented below is the comparative income statement of Edison Company for 2019 and 2018.
Edison Company Income Statement For the Year Ended May 31 | ||
2019 | 2018 | |
Sales | $180,968 | $112,456 |
Cost of Goods Sold | $116,283 | $64,065 |
Gross Profit | $64,685 | $48,391 |
Operating Expenses | ||
Administrative Expense | $16,368 | $14,541 |
Selling Expense | $22,674 | $23,880 |
Total Operating Expenses | $39,042 | $38,421 |
Other Income and Expenses | ||
Interest Expense | $1,266 | $1,082 |
Income Before Income Tax | $24,377 | $8,888 |
Income Tax | $7,313 | $2,666 |
Net Income (Loss) | $17,064 | $6,222 |
a) Calculate the following ratios for both years.
2019 | 2018 | |
Net Profit Margin | ||
Time Interest Earned |
b) In which year does the company have a better performance with respect to the net profit margin calculated in part a)?
Related Book For
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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