For 20Y2, Fielder Industries Inc. initiated a sales promotion campaign that included the expenditure of an additional $40,000 for advertising. At the end of the year, Leif Grando, the president, is presented with the following condensed comparative income statement: Fielder Industries Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Sales $1,300,000 $1,180,000 Cost of goods sold (682,500) (613,600) Gross profit $617,500 $566,400 Selling expenses $(260,000) $(188,800) Administrative expenses (169,000) (177,000) Total operating expenses $(429,000) $(365,800) Operating income $188,500 $200,600 Other revenue 78,000 70,800 Income before income tax expense $266,500 $271,400 Income tax expense (117,000) (106,200) Net income $149,500 $165,200 Required: Question Content Area 1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Fielder Industries Inc.Comparative Income StatementFor the Years Ended December 31, 20Y2 and 20Y1 20Y2 Amount 20Y2 Percent 20Y1 Amount 20Y1 Percent Sales $1,300,000 fill in the blank 18ccc5059fadffc_1% $1,180,000 fill in the blank 18ccc5059fadffc_2% Cost of goods sold (682,500) fill in the blank 18ccc5059fadffc_3% (613,600) fill in the blank 18ccc5059fadffc_4% Gross profit $617,500 fill in the blank 18ccc5059fadffc_5% $566,400 fill in the blank 18ccc5059fadffc_6% Selling expenses $(260,000) fill in the blank 18ccc5059fadffc_7% (188,800) fill in the blank 18ccc5059fadffc_8% Administrative expenses (169,000) fill in the blank 18ccc5059fadffc_9% (177,000) fill in the blank 18ccc5059fadffc_10% Total operating expenses $(429,000) fill in the blank 18ccc5059fadffc_11% $(365,800) fill in the blank 18ccc5059fadffc_12% Operating income $188,500 fill in the blank 18ccc5059fadffc_13% $200,600 fill in the blank 18ccc5059fadffc_14% Other revenue 78,000 fill in the blank 18ccc5059fadffc_15% 70,800 fill in the blank 18ccc5059fadffc_16% Income before income tax expense $266,500 fill in the blank 18ccc5059fadffc_17% $271,400 fill in the blank 18ccc5059fadffc_18% Income tax expense (117,000) fill in the blank 18ccc5059fadffc_19% (106,200) fill in the blank 18ccc5059fadffc_20% Net income $149,500 fill in the blank 18ccc5059fadffc_21% $165,200 fill

For 20Y2, Fielder Industries Inc. initiated a sales promotion campaign that included the expenditure of an additional $40,000 for advertising. At the end of the year, Leif Grando, the president, is presented with the following condensed comparative income statement: Fielder Industries Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y1 Sales $1,300,000 $1,180,000 Cost of goods sold (682,500) (613,600) Gross profit $617,500 $566,400 Selling expenses $(260,000) $(188,800) Administrative expenses (169,000) (177,000) Total operating expenses $(429,000) $(365,800) Operating income $188,500 $200,600 Other revenue 78,000 70,800 Income before income tax expense $266,500 $271,400 Income tax expense (117,000) (106,200) Net income $149,500 $165,200 Required: Question Content Area 1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Fielder Industries Inc.Comparative Income StatementFor the Years Ended December 31, 20Y2 and 20Y1 20Y2 Amount 20Y2 Percent 20Y1 Amount 20Y1 Percent Sales $1,300,000 fill in the blank 18ccc5059fadffc_1% $1,180,000 fill in the blank 18ccc5059fadffc_2% Cost of goods sold (682,500) fill in the blank 18ccc5059fadffc_3% (613,600) fill in the blank 18ccc5059fadffc_4% Gross profit $617,500 fill in the blank 18ccc5059fadffc_5% $566,400 fill in the blank 18ccc5059fadffc_6% Selling expenses $(260,000) fill in the blank 18ccc5059fadffc_7% (188,800) fill in the blank 18ccc5059fadffc_8% Administrative expenses (169,000) fill in the blank 18ccc5059fadffc_9% (177,000) fill in the blank 18ccc5059fadffc_10% Total operating expenses $(429,000) fill in the blank 18ccc5059fadffc_11% $(365,800) fill in the blank 18ccc5059fadffc_12% Operating income $188,500 fill in the blank 18ccc5059fadffc_13% $200,600 fill in the blank 18ccc5059fadffc_14% Other revenue 78,000 fill in the blank 18ccc5059fadffc_15% 70,800 fill in the blank 18ccc5059fadffc_16% Income before income tax expense $266,500 fill in the blank 18ccc5059fadffc_17% $271,400 fill in the blank 18ccc5059fadffc_18% Income tax expense (117,000) fill in the blank 18ccc5059fadffc_19% (106,200) fill in the blank 18ccc5059fadffc_20% Net income $149,500 fill in the blank 18ccc5059fadffc_21% $165,200 fill

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Question Content Area

1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Fielder Industries Inc.Comparative Income StatementFor the Years Ended December 31, 20Y2 and 20Y1

	20Y2 Amount	20Y2 Percent	20Y1 Amount	20Y1 Percent
Sales	$1,300,000	fill in the blank 18ccc5059fadffc_1%	$1,180,000	fill in the blank 18ccc5059fadffc_2%
Cost of goods sold	(682,500)	fill in the blank 18ccc5059fadffc_3%	(613,600)	fill in the blank 18ccc5059fadffc_4%
Gross profit	$617,500	fill in the blank 18ccc5059fadffc_5%	$566,400	fill in the blank 18ccc5059fadffc_6%
Selling expenses	$(260,000)	fill in the blank 18ccc5059fadffc_7%	(188,800)	fill in the blank 18ccc5059fadffc_8%
Administrative expenses	(169,000)	fill in the blank 18ccc5059fadffc_9%	(177,000)	fill in the blank 18ccc5059fadffc_10%
Total operating expenses	$(429,000)	fill in the blank 18ccc5059fadffc_11%	$(365,800)	fill in the blank 18ccc5059fadffc_12%
Operating income	$188,500	fill in the blank 18ccc5059fadffc_13%	$200,600	fill in the blank 18ccc5059fadffc_14%
Other revenue	78,000	fill in the blank 18ccc5059fadffc_15%	70,800	fill in the blank 18ccc5059fadffc_16%
Income before income tax expense	$266,500	fill in the blank 18ccc5059fadffc_17%	$271,400	fill in the blank 18ccc5059fadffc_18%
Income tax expense	(117,000)	fill in the blank 18ccc5059fadffc_19%	(106,200)	fill in the blank 18ccc5059fadffc_20%
Net income	$149,500	fill in the blank 18ccc5059fadffc_21%	$165,200	fill in the blank 18ccc5059fadffc_22%

Question Content Area

2. The net income as a percent of sales has

. All the costs and expenses, other than selling expenses, have maintained their approximate cost as a percent of sales relationship between 20Y1 and 20Y2. Selling expenses as a percent of sales, however, have

. Apparently, the new advertising campaign

been successful. The increased expense

produced sufficient sales to maintain relative profitability. Thus, selling expenses as a percent of sales have

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Fielder Industries Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1
	20Y2	20Y1
Sales	$1,300,000	$1,180,000
Cost of goods sold	(682,500)	(613,600)
Gross profit	$617,500	$566,400
Selling expenses	$(260,000)	$(188,800)
Administrative expenses	(169,000)	(177,000)
Total operating expenses	$(429,000)	$(365,800)
Operating income	$188,500	$200,600
Other revenue	78,000	70,800
Income before income tax expense	$266,500	$271,400
Income tax expense	(117,000)	(106,200)
Net income	$149,500	$165,200