Compare Martinez and Rosado by converting their income statements to common size.Net sales....Cost of goods sold.Other expense.Net income..Which company earns more net income? Which company's net income is a higher percentage of its net sales?Net sales...Cost of goods sold.Other expenses.Net income..$$$$MartinezPrepare the common-sized financial analysis: (Round percentages to the nearest tenth percent.)MartinezAmount10,9006,6603,58665410,900 $6,6603,586%654 $% $%%Rosado%$16,54011,9093,837794RosadoAmount16,54011,9093,837794%do do%%%%

Lets understand the basics.There are two type of analysis are made which are,(1) Verticle…

Compare Martinez and Rosado by converting their income statements to common size. Rosado Net sales.... Cost of goods sold. Other expense Net income... $ $ Martinez 10,900 $ 6,660 3,586 654 $ 16,540 11,909 3,837 794 Which company earns more net income? Which company's net income is a higher percentage of its net sales?

Compare Martinez and Rosado by converting their income statements to common size. Rosado Net sales.... Cost of goods sold. Other expense Net income... $ $ Martinez 10,900 $ 6,660 3,586 654 $ 16,540 11,909 3,837 794 Which company earns more net income? Which company's net income is a higher percentage of its net sales?

College Accounting (Book Only): A Career Approach

12th Edition

ISBN:9781305084087

Author:Cathy J. Scott

Publisher:Cathy J. Scott

Chapter12: Financial Statements, Closing Entries, And Reversing Entries

Section: Chapter Questions

Problem 3E

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The following is select account information for August Sundries. Sales: $850,360; Sales Returns and Allowances: $148,550; COGS: $300,840; Operating Expenses: $45,770; Sales Discounts: $231,820. If August Sundries uses a multi-step income statement format, what is their gross margin?
Direction: Answer the problem below and forecasts the income statement using percent of sales method. (Please refer to the picture)
Comparative Income Statement Use the following comparative income statement form to enter amounts you identify from the computations on the Liquidity and Solvency Measures part and on the Profitability Measures part. Compute any missing amounts and complete the horizontal analysis columns. Enter percentages as decimal amounts, rounded to one decimal place. When rounding, look only at the figure to the right of one decimal place. If 5, round up. For example, for 32.048% enter 32.0%. For 32.058% enter 32.1%. Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Operating income Other expense (interest) Income before income tax expense Income tax expense Net income Comparative Income Statement For the Years Ended December 31, 20Y6 and 20Y5 $ 20Y6 8,250,000 X (1,242,000) 20Y5 $7,287,000 (3,444,000) $3,843,000 $(1,457,600) (1,106,000) $(2,563,600) $1,279,400 (120,600) $1,158,800 (181,980) $976,820 $ $ $ Increase/(Decrease) Amount 823,000 X…
Compute the following for year 2: 2-a. Percentage markup on sales. (Round percentage answer to 1 decimal place (i.e., 0.124 should be entered as 12.4) 2-b. Income tax rate. (Round percentage answer to 1 decimal place (i.e., 0.124 should be entered as 12.4).) 2-c. Net profit margin ratio. Was it a good or poor indicator of performance? (Round percentage answer to 2 decimal places (i.e., 0.1243 should be entered as 12.43).) 2-d. Percentage of total resources invested in property, plant, and equipment. (Round percentage answer to 2 decimal places (i.e., 0.1243 should be entered as 12.43).) 2-e. Debt-to-equity ratio. Interpret the result. (Round the final answer to 2 decimal places.) 2-f. Return on assets. Assume that long-term debt increased to $36,810 in month 1 of year 2. (Round intermediate calculations to 3 decimal places and percentage answer to 2 decimal places (i.e., 0.1243 should be entered as 12.43).) 2-g. Return on equity. (Round percentage answer to 2 decimal places (i.e.,…
True/False The net profit margin ratio is calculated by dividing net sales by net income.
The COGS is estimated by deducting the gross profit from sales revenue. Distinguish between gross profit as a percentage of cost and gross profit as a percentage of sales price and how do you convert the gross profit % based upon cost to gross profit % based upon selling price?
Compute for the following 1. TIE Ratio 2. Gross Profit Ratio 3. Operating Profit Ratio 4. Net Profit Ratio
Preparing an income statement) Prepare an income statement and a common-sized income statement from the following information. Click on the following icon in order to copy its contents into a spreadsheet.) Sales Cost of goods sold General and administrative expense Depreciation expense Interest expense Income taxes Complete the income statement below. (Round to the nearest dollar. NOTE: You may input expense acc as negative values.) Income Statement Gross profits Total operating expenses Operating income (EBIT) Earnings before taxes Net income $525,863 199,246 60,236 8,305 11,860 98,486 $ SS
Which of the following is a technique for reviewing relationships on an income statement by assigning net sales as 100%? A. Ratio analysis. B. Current ratio. C. Horizontal analysis. D. Vertical analysis.
A component of operating efficiency and profitability, calculated by expressing net profit as a percent of net sales, is the: a.Price earnings ratio. b.Profit margin ratio. c.Sales turnover. d.Acid-test ratio.
Prepare common size income statements Which company earns more net income? Which companies net income has a higher percentage of its net sales revenue?
How do you find the gross profit as a percent of sales and income from operations as a percent of sales?