Vertical Analysis of Income Statement

The following comparative income statement (in thousands of dollars) for two recent years was adapted from the annual report of Speedway Motorsports, Inc. (TRK), owner and operator of several major motor speedways, such as the Atlanta, Bristol, Charlotte, Texas, and Las Vegas Motor Speedways.

				Year 2			Year 1
Revenues:
	Admissions			$100,694			$100,798
	Event-related revenue			146,980			146,849
	NASCAR® broadcasting revenue			217,469			207,369
	Other operating revenue			31,320			29,293
		Total revenue		$496,463			$484,309
Expenses and other:
	Direct expense of events			$(104,303)			$(102,196)
	NASCAR® event management fees			(133,682)			(128,254)
	Other direct expenses			(19,541)			(18,513)
	General and administrative			(285,166)			(194,120)
		Total expenses		$(542,692)			$(443,083)
			Income (loss) from continuing operations	$ (46,229)			$ 41,226

Note: General & administrative expenses for Year 2 include impairment of goodwill of $98,868. The impairment of goodwill is discussed in Chapter 7.

a.  Prepare a comparative income statement for Years 1 and 2 in vertical form, stating each item as a percent of revenues.
Round percentage answers to one decimal place.

Speedway Motorsports, Inc.
Comparative Income Statement (in thousands of dollars)
For the Years Ended Year 2 and Year 1
	Year 2 amount	Year 2 percent	Year 1 amount	Year 1 percent
Revenues:
Admissions	$100,694	fill in the blank 640385010036fe2_1%	$100,798	fill in the blank 640385010036fe2_2%
Event-related revenue	146,980	fill in the blank 640385010036fe2_3	146,849	fill in the blank 640385010036fe2_4
NASCAR® broadcasting revenue	217,469	fill in the blank 640385010036fe2_5	207,369	fill in the blank 640385010036fe2_6
Other operating revenue	31,320	fill in the blank 640385010036fe2_7	29,293	fill in the blank 640385010036fe2_8
Total revenue	$496,463	fill in the blank 640385010036fe2_9%	$484,309	fill in the blank 640385010036fe2_10%
Expenses and other:
Direct expense of events	$(104,303)	fill in the blank 640385010036fe2_11%	$(102,196)	fill in the blank 640385010036fe2_12%
NASCAR® event management fees	(133,682)	fill in the blank 640385010036fe2_13	(128,254)	fill in the blank 640385010036fe2_14
Other direct expenses	(19,541)	fill in the blank 640385010036fe2_15	(18,513)	fill in the blank 640385010036fe2_16
General and administrative	(285,166)	fill in the blank 640385010036fe2_17	(194,120)	fill in the blank 640385010036fe2_18
Total expenses	$(542,692)	fill in the blank 640385010036fe2_19%	$(443,083)	fill in the blank 640385010036fe2_20%
Income (loss) from continuing operations	$(46,229)	fill in the blank 640385010036fe2_21%	$41,226	fill in the blank 640385010036fe2_22%

b.  What conclusion can be drawn from the analysis regarding the change in income?