horizontal analysis ### Horizontal Analysis of Gross Sales**Objective:**Perform a horizontal analysis for the entry "Gross Sales" shown on the income statement portion below. Round percentages to one decimal place.#### Income Statement Analysis| Revenue | 2019 | 2018 | Increase/Decrease | Percent ||---------------------------------|-----------|-----------|-------------------|---------|| **Gross Sales** | $277,000 | $200,500 | | || Less: Sales Returns and Allowances | 14,200 | 12,400 | | || **Net Sales** | 262,800 | 188,100 | | || **Cost of Goods Sold** | | | | || Merchandise Inventory | 31,900 | 38,800 | | || Net Purchases | 60,300 | 55,500 | | || Goods Available for Sale | 92,200 | 89,300 | | || Less: Merchandise Inventory (Dec. 31) | 48,000 | 60,200 | | || **Cost of Goods Sold** | 49,200 | 29,100 | | || **Gross Margin** | 213,600 | 159,000 | | |#### Explanation of Analysis Table:- **Revenue:** - **Gross Sales:** Represents total sales before deductions for returns and allowances. - **Net Sales:** Calculated by subtracting Sales Returns and Allowances from Gross Sales.- **Cost of Goods Sold:** - **Merchandise Inventory (Opening):** Inventory at the beginning of the period. - **Net Purchases:** Total purchases minus any returns or allowances. - **Goods Available for Sale:** Sum of Merchandise Inventory and Net Purchases. - **Merchandise Inventory (Closing):** Inventory at the end of the period. - **Cost of Goods Sold (COGS):** Calculated by subtracting the closing inventory from Goods Available for Sale.- **Gross Margin:** Net Sales minus Cost of Goods Sold, representing the profit made before deducting operating expenses.### Graphs/Diagrams:The dataset does not include any graphs or diagrams. However, for educational purposes

An income statement is a record made by the company to determine its earnings in a particular…

Perform a horizontal analysis for the entry "Gross Sales" shown on the income statement portion below. (Round percentages to one decimal place Increase/Decrease Revenue 2019 2018 Amount Percent Gross Sales $277,000 $200,500 $ Less: Sales Returns 14,200 12,400 and Allowances 262,800 188,100 Cost of Goods Sold 31,900 33,800 60,300 55,500 92,200 89,300 43,000 60,200 49,200 29,100 213,600 159,000 Net Sales Merchandise Inventory Net Purchases Goods Available for Sale Less: Merchandise Inventory, Dec. 31 Cost of Goods Sold Gross Margin %

Perform a horizontal analysis for the entry "Gross Sales" shown on the income statement portion below. (Round percentages to one decimal place Increase/Decrease Revenue 2019 2018 Amount Percent Gross Sales $277,000 $200,500 $ Less: Sales Returns 14,200 12,400 and Allowances 262,800 188,100 Cost of Goods Sold 31,900 33,800 60,300 55,500 92,200 89,300 43,000 60,200 49,200 29,100 213,600 159,000 Net Sales Merchandise Inventory Net Purchases Goods Available for Sale Less: Merchandise Inventory, Dec. 31 Cost of Goods Sold Gross Margin %

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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