2006 $50,000 75,000 40,000 50,000 50,000 40,000 Cale Company on December 31, 2007 Account Carrent assets Accounts receable Merchandise inventory Carrent labilities Probie&(10 points) 2007 The following is a summary of infsrmation presented on the financial statements of The $65,000 80,000 50,000 75,000 30,000 50,000 Long-tem liabilities Common stock (2007 5,000 shares 2006: 4,000 shares) Retained earnings 25,000 40,000 $500,000 395,000 105,000 50,000 55,000 $525,000 400,000 125,000 45,000 Net sales revenue Cost of goods sold Gross profit Selling and general expenses Net income before income tax expense Income tax expense Net income 80,000 24.000 $56,000 16,500 $38,500 For Net Sales Revenue and Cost of Goods Sold, using horizontal analysis what would be reported? Problem 7. (10 points) Perform a vertical analysis for 2007 for the following income statement. Account Net sales revenue Cost of goods sold Gross profit Selling and general expenses 2007 $557,000 400,000 2006 $500,000 395,000 105,000 50.000 Percent 157,000 70.000 Net income before income tax Income tax expense 87,000 24.000 $63,000 Net income 55,000 16.500 $38,500