FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Income statements for Walton Company for Year 3 and Year 4 follow:
WALTON COMPANY
Income Statements
Sales
Cost of goods sold.
Selling expenses
Administrative expenses
Interest expense
Total expenses
Income before taxes
Income taxes expense
Net income
Year 4
$201,000
143,700
21,900
13,000
3,700
$182,300
18,700
6,200
$ 12,500
Year 3
$181,000
121,700
19,900
15,000
5,700
$162,300
18,700
3,200
$ 15,500
Required
a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4.
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 Walton Company for Year 3 and Year 4 follow: WALTON COMPANY Income Statements Sales Cost of goods sold. Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income Year 4 $201,000 143,700 21,900 13,000 3,700 $182,300 18,700 6,200 $ 12,500 Year 3 $181,000 121,700 19,900 15,000 5,700 $162,300 18,700 3,200 $ 15,500 Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
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