Observe the net income for both companies. Which company is more profitable?Which company is more profitable using this type of analysis? ABS-CBN CORP.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMEcurrency in philippine pesos, in millionsVertical Analysis2010200920082007Revenues100.0%100.0%100.0%100.0%Cost of Sales52.5%58.4%59.5%55.1%GROSS PROFIT (Gross Income/Net Revenues)47.5%41.6%40.5%44.9%Selling General & Admin Expenses, Total26.7%25.6%24.4%26.7%Depreciation & Amortization, Total2.5%3.0%3.7%3.2%Other Operating Expenses1.3%1.0%1.2%1.2%OTHER OPERATING EXPENSES, TOTAL30.4%29.6%29.3%31.1%0.0%0.0%0.0%INCOME FROM OPERATIONS (Operating Income)17.1%12.0%11.2%13.8%|Interest Expense-3.7%-4.0%-3.5%-2.9%Interest and Investment Income0.4%0.4%0.5%0.6%|Income (Loss) on Equity Investments0.0%0.0%0.0%0.1%Currency Exchange Gains (Loss)Other Non-Operating Income (Expenses)Gain (Loss) on Sale of InvestmentsOther Unusual Items0.8%0.4%-0.1%1.1%1.3%2.3%2.7%-0.8%-0.2%0.0%0.0%0.0%0.0%0.0%1.6%1.1%INCOME BEFORE TAX15.7%11.1%12.3%13.1%Income Tax Expense4.0%3.1%5.3%5.7%NET INCOME11.7%8.0%7.1%7.4% GMA NETWORK INC.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMEcurrency in philippine pesos, in millions2010200920082007Revenues100.0%100.0%100.0%100.0%Cost of Goods Sold40.7%39.3%40.3%40.3%GROSS PROFIT (Gross Income/Net Revenues)59.3%60.7%59.7%59.7%Selling General & Admin Expenses, Total24.7%23.5%22.5%22.5%Depreciation & Amortization, Total2.6%3.2%3.6%3.3%Other Operating Expenses1.4%1.5%1.4%1.3%OTHER OPERATING EXPENSES, TOTAL28.7%28.2%27.5%27.1%INCOME FROM OPERATIONS (Operating Income)30.5%32.5%32.2%32.5%Interest Expense0.0%-0.1%-0.1%-0.2%Interest and Investment Income0.6%0.5%0.7%0.7%Income (Loss) on Equity Investments0.1%-0.1%-0.1%0.0%Currency Exchange Gains (Loss)-0.2%-0.1%0.0%-0.2%Other Non-Operating Income (Expenses)0.2%0.2%0.4%0.9%Gain (Loss) on Sale of Assets0.1%0.1%0.3%0.0%Other Unusual Items, Total0.0%0.0%0.0%0.2%NET INCOME BEFORE TAX31.2%33.1%33.4%33.9%Income Tax Expense8.0%8.8%10.9%11.2%NET INCOME23.2%24.3%22.5%22.6%

Solution:- Observation of net income for both companies as follows under:- Company 2010 2009 2008…

Answered: Observe the net income for both…

Observe the net income for both companies. Which company is more profitable? Which company is more profitable using this type of analysis

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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