Identify any favorable and unfavorable trends in the following income statements by preparing a vertical analysis. (Round percentages to two decimal places.) Year 2 Year 1 Revenues $394,000 $212,500 Operating expenses: Wages expense $ 79,000 $ 65,000 Rent expense 19,000 18,000 Utilities expense 21,000 14,200 Interest expense 7,500 7,800 Total operating expenses $126,500 $105,000 Net income $267,500 $107,500

Identify any favorable and unfavorable trends in the following income statements by preparing a vertical analysis. (Round percentages to two decimal places.) Year 2 Year 1 Revenues $394,000 $212,500 Operating expenses: Wages expense $ 79,000 $ 65,000 Rent expense 19,000 18,000 Utilities expense 21,000 14,200 Interest expense 7,500 7,800 Total operating expenses $126,500 $105,000 Net income $267,500 $107,500

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 38E: Sundahl Companys income statements for the past 2 years are as follows: Refer to the information for...

See similar textbooks

Similar questions

Cuneo Companys income statements for the last 3 years are as follows: Refer to the information for Cuneo Company above. Required: 1. Prepare a common-size income statement for Year 2 by expressing each line item for Year 2 as a percentage of that same line item from Year 1. (Note: Round percentages to the nearest tenth of a percent.) 2. Prepare a common-size income statement for Year 3 by expressing each line item for Year 3 as a percentage of that same line item from Year 1. (Note: Round percentages to the nearest tenth of a percent.)
Sundahl Companys income statements for the past 2 years are as follows: Refer to the information for Sundahl Company above. Required: Prepare a common-size income statement for Year 2 by expressing each line item for Year 2 as a percentage of that same line item from Year 1. (Note: Round percentages to the nearest tenth of a percent.)
Cuneo Companys income statements for the last 3 years are as follows: Refer to the information for Cuneo Company above. Required: 1. Prepare a common-size income statement for Year 1 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) 2. Prepare a common-size income statement for Year 2 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) 3. Prepare a common-size income statement for Year 3 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.)
Sundahl Companys income statements for the past 2 years are as follows: Refer to the information for Sundahl Company above. Required: 1. Prepare a common-size income statement for Year 1 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) 2. Prepare a common-size income statement for Year 2 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.)
Identify any favorable and unfavorable trends in the following income statements by preparing a vertical analysis. Write a paragraph explaining what you find. (Round percentages to two decimal places.) Becker Corporation Income Statements For the Years Ended December 31 Year 2 Revenues Operating expenses: Wages expense Rent expense Utilities expense Interest expense Total operating expenses Net income Year 1 $394,000 $212,500 $ 79,000 $ 65,000 19,000 21,000 7,500 18,000 14,200 7,800 $126,500 $105,000 $267,500 $107,500
Return on Total Assets A company reports the following income statement and balance sheet information for the current year: Net income $661,910Interest expense 116,810Average total assets 6,280,000Determine the return on total assets. If required, round the answer to one decimal place.fill in the blank 1 %
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
A company reports the following income statement and balance sheet information for the current year:Net income $ 410,000Interest expense 90,000Average total assets 5,000,000Determine the return on total assets. Round percentage to one decimal place.
A vertical analysis of two income statements for Danielle's Design Services is shown below: Danielle's Design Services Income Statements For Years 1 and 2 Ending December 31 Year 2 Year 1 Amount Percent Amount Percent Fees earned $765,340 100.0% $696,520 100.0% Operating expenses: Wages expense $254,000 33.2% $214,600 30.8% Rent expense 120,000 15.7% 108,000 15.5% Supplies expense 76,500 10.0% 98,715 14.2% Miscellaneous expense 11,680 1.5% 16,420 2.4% Total operating expenses $462,180 60.4% $437,735 62.9%* Net income $303,160 39.6% $258,785 37.1%* *Differences due to rounding Which of the following analyses reflect the data given? a.Wages expense and miscellaneous expense show an unfavorable trend, and rent and supplies expenses show an unfavorable trend. b.Wages expense and rent expense show a favorable trend, while supplies and miscellaneous expenses show an unfavorable trend. c.Wages expense and rent expense show an unfavorable trend, while…
Revenue and expense data for Young Technologies Inc. are as follows: Year 2 Year 1 Sales $500,000 $440,000 Cost of goods sold 325,000 242,000 Selling expenses 70,000 79,200 Administrative expenses 75,000 70,400 Income tax expense 10,500 16,400 Required: (a) Prepare an income statement in comparative form, stating each item for both years as an amount and as a percent of sales. Round your percentages answers to one decimal place. Enter all amounts as positive numbers. (b) Comment on the significant changes disclosed by the comparative income statement. Prepare an income statement in comparative form, stating each item for both years as an amount and as a percent of sales. Round your percentages answers to one decimal place. Enter all amounts as positive numbers. Young Technologies Inc. Comparative Income Statement For the Years Ended December 31, Year 2 and Year 1 1 Year 2 Year 2 Year 1 Year 1…
Horizontal analysis of the income statement Income statement data for Winthrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Income before income tax expense Income tax expense Net income $2,240,000 (1,925,000) $315,000 $(152,500) (118,000) $(270,500) $44,500 (17,800) $26,700 $2,000,000 (1,750,000) $250,000 $(125,000) (100,000) $(225,000) $25,000 (10,000) $15,000
Assume the following sales data for a company: Current year $896,005 Preceding year 607,844 What is the percentage increase in sales from the preceding year to the current year (rounded to one decimal place)? Oa. 47.4% Ob. 15.3% Oc. 32.2% Od. 79.6%

SEE MORE QUESTIONS

Recommended textbooks for you

Managerial Accounting: The Cornerstone of Busines…

Accounting

ISBN:

9781337115773

Author:

Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:

Cengage Learning

College Accounting, Chapters 1-27

Accounting

ISBN:

9781337794756

Author:

HEINTZ, James A.

Publisher:

Cengage Learning,

Managerial Accounting: The Cornerstone of Busines…

Accounting

ISBN:

9781337115773

Author:

Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:

Cengage Learning

College Accounting, Chapters 1-27

Accounting

ISBN:

9781337794756

Author:

HEINTZ, James A.

Publisher:

Cengage Learning,

SEE MORE TEXTBOOKS

GET THE APP

About FAQ Academic Integrity Sitemap Document Sitemap

Contact Bartleby Contact Research (Essays)High School Textbooks Literature Guides Concept Explainers by Subject Essay Help Mobile App

GET THE APP

Privacy

Your CA Privacy Rights

Your NV Privacy Rights

About Ads

Manage My Data

bartleby, a Learneo, Inc. business




Year 2	Year 1
Revenues	$394,000	$212,500
Operating expenses:
Wages expense	$ 79,000	$ 65,000
Rent expense	19,000	18,000
Utilities expense	21,000	14,200
Interest expense	7,500	7,800
Total operating expenses	$126,500	$105,000
Net income	$267,500	$107,500