The December 31, 2000, income statement accounts and other information of Lyon’s Hardware are shown below:

Advertising expense Depreciation expense: store equipment Depreciation expense: building (store)

Depreciation expense: office equipment Depreciation expense: building (office)

Interest revenue Interest expense Cost of goods sold Insurance expense Sales (net)

Office supplies expense Store supplies expense Sales salaries expense

$ 4,300 1,600 3,700 2,300 1,100 1,700 900 63,900 350 102,000 480 800 5% of net sales Office salaries expense 2,600 Utilities expense (store) 1,500 Utilities expense (office) 400 Required: (1) Prepare a classified 2000 income statement for Lyon’s Hardware.
(2) Compute the profit margin for 2000. If the profit margin for 1999 was 12.5%, what can be said about the 2000 results? lop85