Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 2OY1 20Υ2 20Y1 Sales ... $1,500,000 $1,250,000 Cost of goods sold.... Gross profit ..... Selling expenses 510,000 475,000 $ 990,000 $ 270,000 $ 775,000 $ 200,000 Administrative expenses. 180,000 $ 450,000 $ 540,000 156,250 $ 356,250 $ 418,750 Total operating expenses Income from operations Other revenue 60,000 50,000 $ 600,000 $ 468,750 Income before income tax Income tax expense . 450,000 375,000 ... $ 150,000 $ 93,750 Net income ..

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $50,000 for advertising. At the end of the year, Lumi Neer, the president, is presented with the following condensed comparative income statement:

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Instructions
1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round percentages to one decimal place.
2. To the extent the data permit, comment on the significant relationships
revealed by the vertical analysis prepared in (1).

Tri-Comic Company
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 2OY1
20Υ2
20Y1
Sales ...
$1,500,000
$1,250,000
Cost of goods sold....
Gross profit .....
Selling expenses
510,000
475,000
$ 990,000
$ 270,000
$ 775,000
$ 200,000
Administrative expenses.
180,000
$ 450,000
$ 540,000
156,250
$ 356,250
$ 418,750
Total operating expenses
Income from operations
Other revenue
60,000
50,000
$ 600,000
$ 468,750
Income before income tax
Income tax expense .
450,000
375,000
...
$ 150,000
$ 93,750
Net income ..
Transcribed Image Text:Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 2OY1 20Υ2 20Y1 Sales ... $1,500,000 $1,250,000 Cost of goods sold.... Gross profit ..... Selling expenses 510,000 475,000 $ 990,000 $ 270,000 $ 775,000 $ 200,000 Administrative expenses. 180,000 $ 450,000 $ 540,000 156,250 $ 356,250 $ 418,750 Total operating expenses Income from operations Other revenue 60,000 50,000 $ 600,000 $ 468,750 Income before income tax Income tax expense . 450,000 375,000 ... $ 150,000 $ 93,750 Net income ..
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