Income statements for Campbell Company for Year 3 and Year 4 follow: CAMPBELL COMPANY Income Statements Year 4 Year 3 Sales $ 201,700 $ 181,700 Cost of goods sold 142,400 120,400 Selling expenses 20,700 18,700 Administrative expenses 12,800 14,800 Interest expense 3,100 5,100 Total expenses $ 179,000 $ 159,000 Income before taxes 22,700 22,700 Income taxes expense 5,200 3,000 Net income $ 17,500 $ 19,700 required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. sales % cost of goods sold selling expenses administratives expenses interest expense total expense income before taxes income taxes expense net income (loss)% requiered b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year year 4 year 3 sales % cost of goods sold selling expenses administratives expenses interest expense total expense income before taxes income taxes expense net income (loss)%
Income statements for Campbell Company for Year 3 and Year 4 follow: CAMPBELL COMPANY Income Statements Year 4 Year 3 Sales $ 201,700 $ 181,700 Cost of goods sold 142,400 120,400 Selling expenses 20,700 18,700 Administrative expenses 12,800 14,800 Interest expense 3,100 5,100 Total expenses $ 179,000 $ 159,000 Income before taxes 22,700 22,700 Income taxes expense 5,200 3,000 Net income $ 17,500 $ 19,700 required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. sales % cost of goods sold selling expenses administratives expenses interest expense total expense income before taxes income taxes expense net income (loss)% requiered b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year year 4 year 3 sales % cost of goods sold selling expenses administratives expenses interest expense total expense income before taxes income taxes expense net income (loss)%
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 40E: Cuneo Companys income statements for the last 3 years are as follows: Refer to the information for...
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Income statements for Campbell Company for Year 3 and Year 4 follow:
| CAMPBELL COMPANY Income Statements |
|||||||
| Year 4 | Year 3 | ||||||
| Sales | $ | 201,700 | $ | 181,700 | |||
| Cost of goods sold | 142,400 | 120,400 | |||||
| Selling expenses | 20,700 | 18,700 | |||||
| Administrative expenses | 12,800 | 14,800 | |||||
| Interest expense | 3,100 | 5,100 | |||||
| Total expenses | $ | 179,000 | $ | 159,000 | |||
| Income before taxes | 22,700 | 22,700 | |||||
| Income taxes expense | 5,200 | 3,000 | |||||
| Net income | $ | 17,500 | $ | 19,700 | |||
required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4.
sales %
cost of goods sold
selling expenses
administratives expenses
interest expense
total expense
income before taxes
income taxes expense
net income (loss)%
requiered b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year
year 4 year 3
sales %
cost of goods sold
selling expenses
administratives expenses
interest expense
total expense
income before taxes
income taxes expense
net income (loss)%
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