For 2016, Indigo Company initiated a sales promotion campaign that included the expenditure of an additional $39,000
Question:
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:
Instructions
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 to one decimal place.
2. To the extent the data permit, comment on the significant relationships revealed by the vertical analysis prepared in (1).
Transcribed Image Text:
Indigo Company Comparative Income Statement For the Years Ended December 31, 2016 and 2015 2016 2015 820,000 $600,000 240,000 $360,000 $108,000 54,000 $162,000 $198,000 48,000 Sales . .. 311,600 $508,400 $164,000 57 400 $221,400 $287,000 Income from operations Other income. Income before income tax . 65,600 $352,600 246,000 $106,600 $2 180,000 S 66,000
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Related Book For
Financial and Managerial Accounting
ISBN: 978-1285866307
13th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac
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