Presented below is a combined single-step income and retained earnings statement for Nerwin Company for 2020.           (000 omitted) Net sales revenue         $640,000      Costs and expenses              Cost of goods sold   $500,000            Selling, general, and administrative expenses   66,000            Other, net       17,000         583,000     Income before income tax         57,000     Income tax             19,400     Net income         37,600     Retained earnings at beginning of period, as previously reported   141,000           Adjustment required for correction of error       (7,000)       Retained earnings at beginning of period, as restated         134,000     Dividends on common stock           (12,200) Retained earnings at end of period         $159,400     Additional facts are as follows. 1.    “Selling, general, and administrative expenses” for 2020 included a charge of $8,500,000 that was usual but infrequently occurring. 2.    “Other, net” for 2020 included a loss on sale of equipment of $6,000,000. 3.    “Adjustment required for correction of an error” was a result of a change in estimate (useful life of certain assets reduced to 8 years and a catch-up adjustment made). 4.    Nerwin Company disclosed earnings per common share for net income in the notes to the financial statements. Instructions Determine from these additional facts whether the presentation of the facts in the Nerwin Company income and retained earnings statement is appropriate. If the presentation is not appropriate, describe the appropriate presentation and discuss its theoretical rationale. (Do not prepare a revised statement.)

Identify and Compute NOPAT Following is the income statement for Lowe’s Companies Inc. LOWE’S COMPANIES INC.   Consolidated Statement of Earnings   Twelve Months Ended (In millions) Feb. 1, 2019 Net sales $80,579 Cost of sales 54,693 Gross margin 25,886 Expenses   Selling, general and administrative 19,677 Depreciation and amortization 1,669 Operating income 4,540 Interest expense, net 705 Pretax earnings 3,835 Income tax provision 1,220 Net earnings $2,615   Compute its net operating profit after tax (NOPAT) for the 12 months ended February 1, 2019, assuming a 22% total statutory tax rate.     Feb. 1, 2019   NOPAT Answer

The following items were taken from the financial statements of Kramer Manufacturing, Inc., over a 3-year period:          Item                           2021                2020                2019    Net sales                        $226,000         $212,000         $200,000 Cost of goods sold           150,000           140,000           125,000 Gross profit                     $ 76,000         $  72,000         $  75,000   Instructions Using horizontal analysis and 2019 as the base year, compute the trend percentages for net sales, cost of goods sold, and gross profit.              Item                            2021                2020                2019 Net sales                                   %                     %              100% Cost of goods sold                    %                     %               100% Gross profit                                %                     %               100%   Explain whether the trends are favorable or unfavorable for each…

Prepare a horizontal analysis of the following comparative income statement for the Buff Bodies Corporation. Round percentage changes to the nearest one-hundredth percent.   Buff Bodies Corporation Comparative Income Statement for the Years Ended December 31, 2020 and 2019    2020                              2019  Total revenue                       $1,450,000                        $1,300,000 Expenses: Cost of goods sold       $   1,023,000                        $   930,000 Operating expenses             310,000                             275,000 Interest expense                    12,000                               10,000 Income tax expense               48,300                               38,000 Total expenses                     $1,393,300                        $1,253,000 Net income                          $     56,700                        $     47,000

The following information is taken from the records of Erie Corp.(in thousands) for the year ended on December 31:        2019      2018 Sales      $1,397      $1,122 Cost of Goods Sold      935      814 Selling Expenses      154      121 General Expenses      88      77 Other Revenue      4      7 Interest Expense      2      9 Income Taxes      134      66 After preparing a vertical analysis of this income statement data, what were the favorable and unfavoralbe changes?

Current Attempt in Progress Operating data for Grouper Corp. are presented as follows. Net sales Cost of goods sold Selling expenses Administrative expenses Income tax expense Net income 2022 $840,000 540,120 133,560 57,120 31,920 77,280 2021 $610,000 405,650 80,520 46,970 26,840 50,020 Prepare a schedule showing a vertical analysis for 2022 and 2021. (Round percentages to 1 decimal place, e.g. 12.1%.)

Subject:

Identify and Compute NOPATFollowing is the income statement for Lowe’s Companies Inc. LOWE’S COMPANIES INC.     Consolidated Statement of Earnings     Twelve Months Ended (In millions)   Feb. 1, 2019 Net sales   $142,618 Cost of sales   96,802 Gross margin   45,816 Expenses     Selling, general and administrative   34,826 Depreciation and amortization   2,954 Operating income   8,036 Interest expense, net   1,248 Pretax earnings   6,788 Income tax provision   2,160 Net earnings   $4,628 Compute its net operating profit after tax (NOPAT) for the 12 months ended February 1, 2019, assuming a 22% total statutory tax rate.Note: Round your answer to the nearest whole dollar (millions).

For 20Y2, Macklin Inc. reported a significant decrease in net income. At the end of the year, John Mayer, the president, is presented with the following condensed comparative income statement: Macklin Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Υ2 20Y1 Sales $483,672 $408,000 Cost of goods sold (358,800) (260,000) Gross profit $124,872 $148,000 Selling expenses $(50,150) $(34,000) Administrative expenses (29,520) (22,000) Total operating expenses $(79,670) $(56,000) Operating income $45,202 $92,000 Other revenue 2,166 1,700 Income before income tax expense $47,368 $93,700 Income tax expense (13,300) (28,100) Net income $34,068 $65,600 Required:

A condensed income statement for Weber Associates and a partially completed vertical analysis follow. Required: 1. Complete the vertical analysis by computing each missing line item as a percentage of net revenues. TIP: In the prior year, Cost of Goods Sold was 31 percent of Net Revenues, computed as ($1,397 ÷ $4,571). 2. Does Cost of Goods Sold, as a percentage of Net Revenues, represent better or worse performance in 2019 as compared to 2018? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the vertical analysis by computing each missing line item as a percentage of net revenues. TIP: In the prior year, Cost of Goods Sold was 31 percent of Net Revenues, computed as ($1,397 ÷ $4,571). (Decreases should be indicated by a minus sign. Round your answers to the nearest whole percent.) Net Revenues Cost of Goods Sold Research and Development Expense Sales and Marketing Expense General and Administrative Expense Income from Operations Other…