Sundahl Companys income statements for the past 2 years are as follows: Sundahl Company Income Statements For
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Question:
Sundahl Company’s income statements for the past 2 years are as follows:
Sundahl Company |
Income Statements |
For the Years 1 and 2 |
1 | Year 1 | Year 2 | |
2 | Sales | $2,004,000.00 | $1,802,000.00 |
3 | Less: Cost of goods sold | (1,402,000.00) | (1,200,000.00) |
4 | Gross margin | $602,000.00 | $602,000.00 |
5 | Less operating expenses: | ||
6 | Selling expenses | $(292,000.00) | $(292,000.00) |
7 | Administrative expenses | (110,800.00) | (119,700.00) |
8 | Operating income | $199,200.00 | $190,300.00 |
9 | Less: | ||
10 | Interest expense | (49,200.00) | (40,300.00) |
11 | Income before taxes | $150,000.00 | $150,000.00 |
Required: | |
1. | Prepare a common-size income statement for Year 1 by expressing each line item as a percentage of sales revenue. (Note: 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. (Note: Round percentages to the nearest tenth of a percent.) |
Related Book For
Cornerstones of Managerial Accounting
ISBN: 978-0324660135
3rd Edition
Authors: Mowen, Hansen, Heitger
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