Horizontal analysis of income statemen For 2012, McDade Company reported a decline in net income. At...
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Horizontal analysis of income statemen For 2012, McDade Company reported a decline in net income. At the end of the year, T. Burrows, the president, is presented with the following condensed comparative income statement: McDade Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Sales $16,800,000 $15,000,000 Cost of goods sold (11,500,000) (10,000,000) Gross profit $5,300,000 $5,000,000 Selling expenses $(1,770,000) $(1,500,000) Administrative expenses (1,220,000) (1,000,000) > Total operating expenses $(2,990,000) $(2,500,000) Operating income $2,310,000 $2,500,000 Other revenue 256,950 225,000 Income before income tax expense $2,566,950 $2,725,000 Income tax expense (1,413,000) (1,500,000) Net income $1,153,950 $1,225,000 1. Prepare a comparative income statement with horizontal analysis for the two-year period, using 20Y1 as the base year. Round percentages to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Check My Work Previous Next > 1. Prepare a comparative income state wo-year period, using 20Y1 as the base year. Round percentages to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. McDade Company Comparative Income Statement For the Years Ended December 31, 2012 and 20Y1 Line Item Description 20Y2 20Y1 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Operating Income Other revenue Income before income tax expense Income tax Increase/(Decrease) Increase/(Decrease) Percent Amount % % % % % % % % 900 Operating income Other revenue Income before income tax expense Income tax expense Net income % % % % 2. To the extent the data permit, comment on the significant relationships revealed by the horizontal analysis prepared in (1). Net income has from 20Y1 to 20Y2. Sales have however, the cost of goods sold has pace than sales. In at a faster rate than sales. causing the gross profit to increase at a addition, total operating expenses have in costs and expenses that are higher than the increase in sales have caused the net income to Horizontal analysis of income statemen For 2012, McDade Company reported a decline in net income. At the end of the year, T. Burrows, the president, is presented with the following condensed comparative income statement: McDade Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Sales $16,800,000 $15,000,000 Cost of goods sold (11,500,000) (10,000,000) Gross profit $5,300,000 $5,000,000 Selling expenses $(1,770,000) $(1,500,000) Administrative expenses (1,220,000) (1,000,000) > Total operating expenses $(2,990,000) $(2,500,000) Operating income $2,310,000 $2,500,000 Other revenue 256,950 225,000 Income before income tax expense $2,566,950 $2,725,000 Income tax expense (1,413,000) (1,500,000) Net income $1,153,950 $1,225,000 1. Prepare a comparative income statement with horizontal analysis for the two-year period, using 20Y1 as the base year. Round percentages to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Check My Work Previous Next > 1. Prepare a comparative income state wo-year period, using 20Y1 as the base year. Round percentages to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. McDade Company Comparative Income Statement For the Years Ended December 31, 2012 and 20Y1 Line Item Description 20Y2 20Y1 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Operating Income Other revenue Income before income tax expense Income tax Increase/(Decrease) Increase/(Decrease) Percent Amount % % % % % % % % 900 Operating income Other revenue Income before income tax expense Income tax expense Net income % % % % 2. To the extent the data permit, comment on the significant relationships revealed by the horizontal analysis prepared in (1). Net income has from 20Y1 to 20Y2. Sales have however, the cost of goods sold has pace than sales. In at a faster rate than sales. causing the gross profit to increase at a addition, total operating expenses have in costs and expenses that are higher than the increase in sales have caused the net income to
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Related Book For
Managerial Accounting
ISBN: 978-1337270595
14th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac
Posted Date:
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