The income statement comparison for Forklift Material Handling shows the income statement for the current and prior year. FORKLIFT MATERIAL HANDLING Income statement Comparison Current Year Prior Year (Amounts in thousands) Sales $33,700 $24,700 Cost of goods sold 21,905 16,796 Gross profit $11,795 $7,904 Expenses: Wages $8,750 $6,187 Utilities 650 200 Repairs 169 325 Selling 506 100 Total Expenses $10,075 $6,812 Operating income ? ? Operating income % ? ? Total assets (investment base) $4,400 $1,500 Return on investment ? ? Residual income (8% cost of capital) ? ? A. Determine the operating income (loss) (dollars) for each year. If required round final answers to two decimal places. Current Year Prior Year Operating income (loss) $fill in the blank 1 $fill in the blank 2 B. Determine the operating income (loss) (percentage) for each year. If required round final answers to two decimal places. Current Year Prior Year Operating income (loss) fill in the blank 3% fill in the blank 4% c. The company made a strategic decision to invest in additional assets in the current year. These amounts are provided. Using the total assets amounts as the investment base, calculate the return on investment. Was the decision to invest additional assets in the company successful? If required round final answers to two decimal places. Current Year Prior Year Return on investment fill in the blank 5% fill in the blank 6% D. Assuming an 8% cost of capital, calculate the residual income for each year. Do not round intermediate computations and round final answers to nearest whole dollar. For those boxes in which you must enter subtractive or negative numbers use a minus sign. Current Year Prior Year Residual income $fill in the blank 8 $fill in the blank 9 The residual income related to the investment in the current year. This with the ROI results. Management consider both methods in their analysis of the investment.

The income statement comparison for Forklift Material Handling shows the income statement for the current and prior year. FORKLIFT MATERIAL HANDLING Income statement Comparison Current Year Prior Year (Amounts in thousands) Sales $33,700 $24,700 Cost of goods sold 21,905 16,796 Gross profit $11,795 $7,904 Expenses: Wages $8,750 $6,187 Utilities 650 200 Repairs 169 325 Selling 506 100 Total Expenses $10,075 $6,812 Operating income ? ? Operating income % ? ? Total assets (investment base) $4,400 $1,500 Return on investment ? ? Residual income (8% cost of capital) ? ? A. Determine the operating income (loss) (dollars) for each year. If required round final answers to two decimal places. Current Year Prior Year Operating income (loss) $fill in the blank 1 $fill in the blank 2 B. Determine the operating income (loss) (percentage) for each year. If required round final answers to two decimal places. Current Year Prior Year Operating income (loss) fill in the blank 3% fill in the blank 4% c. The company made a strategic decision to invest in additional assets in the current year. These amounts are provided. Using the total assets amounts as the investment base, calculate the return on investment. Was the decision to invest additional assets in the company successful? If required round final answers to two decimal places. Current Year Prior Year Return on investment fill in the blank 5% fill in the blank 6% D. Assuming an 8% cost of capital, calculate the residual income for each year. Do not round intermediate computations and round final answers to nearest whole dollar. For those boxes in which you must enter subtractive or negative numbers use a minus sign. Current Year Prior Year Residual income $fill in the blank 8 $fill in the blank 9 The residual income related to the investment in the current year. This with the ROI results. Management consider both methods in their analysis of the investment.

Fundamentals of Financial Management (MindTap Course List)

15th Edition

ISBN:9781337395250

Author:Eugene F. Brigham, Joel F. Houston

Publisher:Eugene F. Brigham, Joel F. Houston

Chapter4: Analysis Of Financial Statements

Section: Chapter Questions

Problem 24P: Income Statement for Year Ended December 31, 2018 (Millions of Dollars) Net sales 795.0 Cost of...

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Question

The income statement comparison for Forklift Material Handling shows the income statement for the current and prior year.

FORKLIFT MATERIAL HANDLING Income statement Comparison
	Current Year	Prior Year
(Amounts in thousands)
Sales	$33,700	$24,700
Cost of goods sold	21,905	16,796
Gross profit	$11,795	$7,904
Expenses:
Wages	$8,750	$6,187
Utilities	650	200
Repairs	169	325
Selling	506	100
Total Expenses	$10,075	$6,812

Operating income	?	?
Operating income %	?	?
Total assets (investment base)	$4,400	$1,500
Return on investment	?	?
Residual income (8% cost of capital)	?	?

A. Determine the operating income (loss) (dollars) for each year. If required round final answers to two decimal places.

	Current Year		Prior Year
Operating income (loss)	$fill in the blank 1		$fill in the blank 2

B. Determine the operating income (loss) (percentage) for each year. If required round final answers to two decimal places.

	Current Year		Prior Year
Operating income (loss)	fill in the blank 3%		fill in the blank 4%

c. The company made a strategic decision to invest in additional assets in the current year. These amounts are provided. Using the total assets amounts as the investment base, calculate the return on investment. Was the decision to invest additional assets in the company successful? If required round final answers to two decimal places.

	Current Year		Prior Year
Return on investment	fill in the blank 5%		fill in the blank 6%

D. Assuming an 8% cost of capital, calculate the residual income for each year. Do not round intermediate computations and round final answers to nearest whole dollar. For those boxes in which you must enter subtractive or negative numbers use a minus sign.

	Current Year		Prior Year
Residual income	$fill in the blank 8		$fill in the blank 9

The residual income related to the investment in the current year. This with the ROI results. Management consider both methods in their analysis of the investment.

Current Year
Prior Year
(Amounts in thousands)
Sales
$33,700
$24,700
Cost of goods sold
21,905
16,796
Gross profit
$11,795
$7,904
Expenses:
Wages
$8,750
$6,187
Utilities
650
200
Repairs
169
325
Selling
506
100
Total Expenses
$10,075
$6,812
Operating income
?
?
Operating income %
?
?
Total assets (investment base)
$4,400
$1,500
Return on investment
?
?
Residual income (8% cost of capital)
?
?
A. Determine the operating income (loss) (dollars) for each year. If required round final answers to two decimal places.
Current Year
Prior Year
Operating income (loss) $
2$
B. Determine the operating income (loss) (percentage) for each year. If required round final answers to two decimal places.
Current Year
Prior Year
Operating income (loss)
%
%

c. The company made a strategic decision to invest in additional assets in the current year. These amounts are provided. Using the total assets amounts as the investment
base, calculate the return on investment. Was the decision to invest additional assets in the company successful? If required round final answers to two decimal
places.
Current Year
Prior Year
Return on investment
%
%
D. Assuming an 8% cost of capital, calculate the residual income for each year. Do not round intermediate computations and round final answers to nearest
whole dollar. For those boxes in which you must enter subtractive or negative numbers use a minus sign.
Current Year
Prior Year
Residual income $
The residual income related to the investment
in the current year. This
with the ROI results. Management
consider both methods in their analysis of the investment.

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