1. Two income statements for Toby Sam Enterprises are shown below: Toby Sam Enterprises Income Statement For...
Question:
1. Two income statements for Toby Sam Enterprises are shown below:
Toby Sam Enterprises | ||
Income Statement | ||
For the Years 2 and 1 Ending December 31 | ||
| Year 2 | Year 1 |
Fees earned | $674,350 | $520,600 |
Operating expenses | 472,045 | 338,390 |
Operating income | $202,305 | $182,210 |
Prepare a vertical analysis of Toby Sam Enterprises income statements. Has operating income increased or decreased as a percentage of revenue?
a. increased by 111%
b. decreased by 5%
c. decreased by 111%
d. increased by 5%
2. The following accounts were taken from the Adjusted Trial Balance columns of the work sheet:
Accumulated Depreciation | $ 3,200 |
Fees Earned | 17,400 |
Depreciation Expense | 1,300 |
Insurance Expense | 400 |
Prepaid Insurance | 4,800 |
Supplies | 900 |
Supplies Expense | 3,800 |
Net income for the period is
a. $5,500
b. $17,400
c. $11,900
d. $8,700
3. The ratio of sales to assets measures how effectively a business is using its assets to generate sales. True or False
Financial Accounting
ISBN: 978-1305088436
14th edition
Authors: Carl S. Warren, Jim Reeve, Jonathan Duchac