For 2012, McDade Company reported a decline in net income. At the end of the year, T. Burrows, the president, is presented with the following condensed comparative income Statement:   Instructions 1. Prepare a comparative income statement with horizontal analysis for the two-year period, using 20Y1 as the base year. Round percentages to one decimal place. 2. To the extent the data permit, comment on the significant relationships revealed by the horizontal analysis prepared in (1).

Prepare a horizontal analysis of both the balance sheet and income statement. Complete this question by entering your answers in the tabs below. Analysis Bal Analysis Inc Sheet Stmt Prepare a horizontal analysis of the income statement. (Negative answers should be indicated by a minus sign. Round your answers to 1 decimal place. (i.e., .234 should be entered as 23.4).) ALLENDALE COMPANY Horizontal Analysis of Income Statements Year 4 Year 3 % Change Revenues Sales (net) $ 230,000 $ 210,000 % Other revenues 8,000 5,000 Total revenues 238,000 215,000 Expenses Cost of goods sold 120,000 103,000 Selling, general, and administrative expenses 55,000 50,000 Interest expense 8,000 7,200 Income tax expense 23,000 22,000 Total expenses 206,000 182,200 Net income (loss) $ 32,000 $ 32,800 %

Compute common-size percents for the following comparative income statements (round percents to one decimal). Using the common-size percents, which item is most responsible for the decline in net income?

2) Ratios  Based on the information given in picture #1, complete the following ratios for the last TWO  years and indicate whether the trend is favorable or unfavorable. Note percentages and times should be to one decimal place (e.g. 14.8%; 5.8x) Profitability Ratios                          Current Yr.  Prior Yr.   Fav/Unfav. Gross Margin (%) {Gross Income/Sales Revenue}   Profit Margin (%) {Net income/ Sales Revenue}   Return on Assets (%) {Net Income/ Average Total Assets}

Prepare a horizontal analysis of Nebraska Technologies's income statements. For decreases or negative numbers use a minus sign. Round percentages to one decimal place. Year 1 Increase (Decrease) Percent Favorable/Unfavorable 1 2 3 4 5 6 7 Sales Wage expense Rent expense Utilities expense Total operating expenses Net income Year 2 $158,400.00 $80,000.00 28,000.00 30,000.00 $138,000.00 $162,500.00 $92,500.00 30,000.00 25,000.00 $147,500.00 $20,400.00 $15,000.00

Prepare common size income statements Which company earns more net income? Which companies net income has a higher percentage of its net sales revenue?

A condensed income statement for Stock Storage and a partially completed vertical analysis are presented below. Required: 1. Complete the vertical analysis by computing each missing line item as a percentage of sales revenues. 2. Does Stock's Cost of Goods sold for the current year, as a percentage of revenues, represent better or worse performance as compared to that for the previous year? 3. Has Stock"s net profit margin increased, or decreased, over the two years? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Complete the vertical analysis by computing each missing line item as a percentage of sales revenues. (Round your answers to the nearest whole percent.) STOCK STORAGE Income Statement (summarized) (in millions of U.S. dollars) Current Year Previous Year Sales Revenues $ 2,090 100 % $ 2,170 100 % Cost of Goods Sold 1,697 81 % 1,661 % Selling, General, and Administrative Expenses 285 % 286 13 % Other Operating Expenses 51 2 %…

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Horizontal analysis of income statement (No incorrect answers so far most Experts today are giving me false answers)  For 20Y2, McDade Company reported a decline in net income. At the end of the year, T. Burrows, the president, is presented with the following condensed comparative income statement: McDade Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1   20Y2 20Y1 Sales $ 16,800,000 $ 15,000,000 Cost of goods sold (11,500,000) (10,000,000) Gross profit $ 5,300,000 $ 5,000,000 Selling expenses $ (1,770,000) $ (1,500,000) Administrative expenses (1,220,000) (1,000,000) Total operating expenses $ (2,990,000) $ (2,500,000) Operating income $ 2,310,000 $ 2,500,000 Other revenue 256,950 225,000 Income before income tax expense $ 2,566,950 $ 2,725,000 Income tax expense (1,413,000) (1,500,000) Net income $ 1,153,950 $ 1,225,000 1. Prepare a comparative income statement with horizontal analysis for the two-year…

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