FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Income statements for Stuart Company for Year 3 and Year 4 follow:
STUART COMPANY
Income Statements
Sales
Cost of goods sold
Selling expenses
Administrative expenses
Interest expense
Total expenses
Income before taxes
Income taxes expense
Net income
Required
Year 4
$ 200,500
142,400
21.400
12,200
Year 3
$ 180,500
120,400
19,400
179,700
20,800
5,200
3.000
$ 15,600 $ 17.800
159,700
a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year
b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
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Transcribed Image Text:Income statements for Stuart Company for Year 3 and Year 4 follow: STUART COMPANY Income Statements Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income Required Year 4 $ 200,500 142,400 21.400 12,200 Year 3 $ 180,500 120,400 19,400 179,700 20,800 5,200 3.000 $ 15,600 $ 17.800 159,700 a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
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