Financial Accounting: Tools for Business Decision Making, 8th Edition
8th Edition
ISBN: 9781118953808
Author: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
Publisher: WILEY
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Chapter 13, Problem 13.7BE
To determine
Horizontal Analysis: Horizontal analysis is prepared to make comparison between the financial statements to determine the changes in the financial statements for the previous year to the current year. The changes of the company are measured in dollars as well as in percentage.
Formula:
To determine: The net income for 2016.
Given info: Net income and percentage change for 2017.
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Given the historical income statement of Mega Trade Inc., how much would be added to the company's retained earning for the year 2016 (in millions)?
Income Statement ( $ Million)
Year End
2015
2016
2017
2019
Sales
1, 234.90
1,251.70
1,300.40
1,334.40
Cost of Sales
-679.1
-659
-681.3
-667
Gross Operating Income
Selling & Administration
-339.7
-348.6
-351.2
-373.3
Depreciation
-47.5
-52
-55.9
-75.2
Other Income / Expenses
11.8
7.6
7
8.2
Earnings Before Interest and Taxes
Interest Income
1.3
1.4
1.7
2
Interest Expense
-16.2
-15.1
-20.5
-23.7
Pre Tax Income
Income Taxes
-56.8
-64.2
-67.5
-72.6
Net Income
Dividends
-38.3
-38.7
-39.8
-40.1
None
In the income statement below, ABC Trade Inc. wants to find the resulting net income for the year 2018 (in million). What is the right amount?
Income Statement ($ Million)
Year End
2015
2016
2017
2018
Sales
1,234.90
1,251.70
1,300.40
1,334.40
Cost of Sales
(679.10)
(659.00)
(681.30)
(667.00)
Gross Operating Income
Selling & Administration
(339.70)
(348.60)
(351.20)
(373.30)
Depreciation
(47.50)
(52.00)
(55.90)
(75.20)
Other Income/Expenses
11.80
7.60
7.00
8.20
Earnings Before Interest and Taxes
Interest Income
1.30
1.40
1.70
2.00
Interest Expense
(16.20)
(15.10)
(20.50)
(23.70)
Pre Tax Income
Income Taxes
(56.80)
(64.20)
(67.50)
(72.60)
Net Income
Dividends
(38.30)
(38.70)
(39.80)
(40.10)
Addition to Retained Earnings
Group of answer choices
121.8
108.7
132.7
132.8
No choice given
Chapter 13 Solutions
Financial Accounting: Tools for Business Decision Making, 8th Edition
Ch. 13 - Prob. 1QCh. 13 - Prob. 2QCh. 13 - Prob. 3QCh. 13 - Prob. 4QCh. 13 - Prob. 5QCh. 13 - Prob. 6QCh. 13 - Prob. 7QCh. 13 - Prob. 8QCh. 13 - Prob. 9QCh. 13 - (a) Distinguish among the following bases of...
Ch. 13 - Prob. 11QCh. 13 - Prob. 12QCh. 13 - Prob. 13QCh. 13 - Prob. 14QCh. 13 - Prob. 15QCh. 13 - Prob. 16QCh. 13 - Prob. 17QCh. 13 - Prob. 18QCh. 13 - Prob. 19QCh. 13 - Prob. 20QCh. 13 - Prob. 21QCh. 13 - Prob. 22QCh. 13 - Prob. 13.1BECh. 13 - Prob. 13.2BECh. 13 - Prob. 13.3BECh. 13 - Prob. 13.4BECh. 13 - Prob. 13.5BECh. 13 - Prob. 13.6BECh. 13 - Prob. 13.7BECh. 13 - Prob. 13.8BECh. 13 - Prob. 13.9BECh. 13 - Prob. 13.10BECh. 13 - Prob. 13.11BECh. 13 - Prob. 13.12BECh. 13 - Prob. 13.13BECh. 13 - Prob. 13.14BECh. 13 - Prob. 13.15BECh. 13 - Prob. 13.1DIECh. 13 - Prob. 13.2DIECh. 13 - Prob. 13.3DIECh. 13 - Prob. 13.1ECh. 13 - Prob. 13.2ECh. 13 - Prob. 13.3ECh. 13 - Prob. 13.4ECh. 13 - Prob. 13.5ECh. 13 - Prob. 13.6ECh. 13 - Prob. 13.7ECh. 13 - Prob. 13.8ECh. 13 - Prob. 13.9ECh. 13 - Prob. 13.10ECh. 13 - Prob. 13.11ECh. 13 - Prob. 13.12ECh. 13 - Prob. 13.13ECh. 13 - Prob. 13.1APCh. 13 - Prob. 13.2APCh. 13 - Prob. 13.3APCh. 13 - Prob. 13.4APCh. 13 - Prob. 13.5APCh. 13 - Prob. 13.1EYCTCh. 13 - Prob. 13.2EYCTCh. 13 - Prob. 13.3EYCTCh. 13 - Prob. 13.4EYCTCh. 13 - Prob. 13.7EYCTCh. 13 - Prob. 13.8EYCTCh. 13 - Prob. 13.9EYCTCh. 13 - Prob. 13.1IFRS
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