Common-Sized Income Statement

Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhills data are expressed in dollars. The electronics industry averages are expressed in percentages.

	Tannenhill Company			Electronics Industry Average
Sales	$2,310,000			100	%
Cost of goods sold	1,593,900			75
Gross profit	$716,100			25	%
Selling expenses	$415,800			13	%
Administrative expenses	161,700			6
Total operating expenses	$577,500			19	%
Operating income	$138,600			6	%
Other revenue	46,200			2
	$184,800			8	%
Other expense	23,100			1
Income before income tax	$161,700			7	%
Income tax expense	69,300			4
Net income	$92,400			3	%

Question Content Area

a. Prepare a common-sized income statement comparing the results of operations for Tannenhill Company with the industry average. If required, round percentages to one decimal place. Enter all amounts as positive numbers.

Tannenhill Company Common-Sized Income Statement For the Year Ended December 31

	Tannenhill Company Amount	Tannenhill Company Percent	Electronics Industry Average
Sales	$2,310,000	fill in the blank 9130d4fc506405d_1%	100.0%
Cost of goods sold	1,593,900	fill in the blank 9130d4fc506405d_2%	75%
Gross profit	$716,100	fill in the blank 9130d4fc506405d_3%	25%
Selling expenses	$415,800	fill in the blank 9130d4fc506405d_4%	13%
Administrative expenses	161,700	fill in the blank 9130d4fc506405d_5%	6%
Total operating expenses	$577,500	fill in the blank 9130d4fc506405d_6%	19%
Income from operations	$138,600	fill in the blank 9130d4fc506405d_7%	6%
Other revenue	46,200	fill in the blank 9130d4fc506405d_8%	2%
	$184,800	fill in the blank 9130d4fc506405d_9%	8%
Other expense	23,100	fill in the blank 9130d4fc506405d_10%	1%
Income before income tax	$161,700	fill in the blank 9130d4fc506405d_11%	7%
Income tax expense	69,300	fill in the blank 9130d4fc506405d_12%	4%
Net income	$92,400	fill in the blank 9130d4fc506405d_13%	3%

Question Content Area

b. The company is managing the cost of manufacturing product

as well as or betterworse

than the industry, and has slightly

higherlower

selling and administrative expenses relative to the industry. The combined impact causes net income as a percent of sales to be

betterworse

than the industry average.