A comparative income statement is given below for McKenzie Sales Limited, of Toronto McKenzie Sales, Limited Comparative Income Statement This Year Last Year Sales $ 7,380,000 $ 5,608, see Cost of goods sold 4.260,000 3,509,500 Gross margin 2,620, eee 2,099,300 Selling and administrative expenses: Selling expenses 1,392,000 1,078, eee Administrative expenses 711,000 613,5ee Total expenses 2,103,00 1,691,500 Net operating income 517,000 407,888 Interest expense 98,000 87.ee Net income before taxes $ 419, eee $ 320,800 Members of the company's board of directors are surprised to see that net income increased by only $98.200 when sales increased by $1771.200 Required: 1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e.. 0.1234 should be entered as 12.3).) This Year Last Year % % Sales Cost of goods sold Gross margin Selling and administrative expenses Selling expenses Administrative expenses 0.0 % 0.01% 36 interest expense Net Income before taxes 98, ud $ 419,000 , $ 320,800 Members of the company's board of directors are surprised to see that net income increased by only $98,200 when sales increased by $1.771,200 Required: 1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e. 0.1234 should be entered as 12.3).) Last Year This Year % % % % 0.01% 0.0% Sales Cost of goods sold Gross margin Soling and administrative expenses Selling expenses Administrative expenses Total selling and administrative expenses Not operating income Interest expense Net Income before taxes % 96 % 0.0 % 0.0 % % 0.0 % 0.0% % 00% 0.01 Exercise 14-12 (Algo) Selected Financial Measures for Assessing Liquidity [LO14-2) Norsk Optronics, ALS of Bergen, Norway, had a current ratio of 4 on June 30 of the current year. On that date, the company's assets were Cash Accounts receivable, net Inventory Prepaid expenses Plant and equipment, net Total assets $ 72,000 410,000 690,eee 12,000 1,748,689 $ 2,924, eee Required: 1. What was the company's working capital on June 302 2. What was the company's acid-test ratio on June 30? (Round your answer to 2 decimal places.) 3. The company paid an account payable of $49,000 immediately after June 30. a. What effect did this transaction have on working capital? b. What effect did this transaction have on the current ratio? (Round your intermediate calculations to 1 decimal place.) 1. Working capital 2. Acid-test ratio 3a Effect on working capital 3b. Effect on current ratio
