eBook Show Me How Print Item Horizontal analysis of income statement For 20Y2, McDade Company reported a decline in net income. At the end of the year, T. Burrows, the president, is presented with the following condensed comparative income statement: McDade Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 2011 Sales $ 16,800,000 $ 15,000,000 Cost of goods sold (11,500,000) (10,000,000) Gross profit $ 5,300,000 $5,000,000 Selling expenses $ (1,770,000) $ (1,500,000) Administrative expenses (1,220,000) (1,000,000) Total operating expenses $ (2,990,000) $ (2,500,000) Operating income $ 2,310,000 $ 2,500,000 Other revenue 256,950 225,000 Income before income tax expense $ 2,566,950 $ 2,725,000 Income tax expense (1,413,000) (1,500,000) Net income $ 1,153,950 $ 1,225,000 1. Prepare a comparative income statement with horizontal analysis for the two-year period, using 20Y1 as the base year. Round percentages to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. McDade Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 2041 Check My Work Previous Next All work saved. Email Instructor Save and Exit Submit Assignment for Grading eBook Show Me How Print Item 1. Prepare a comparative income statement with horizontal analysis for the two-year period, using 20Y1 as the base year. Round percentages to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. McDade Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 Increase/(Decrease) 20Y2 2011 Amount Percent Sales % Cost of goods sold % Gross profit $ % $ $ $ % Selling expenses Administrative expenses % Total operating expenses % Operating income $ $ % Other revenue Chapter 14 Homework assignmer Income before income tax expenses $ % Income tax expense % Net income % 2. To the extent the data permit, comment on the significant relationships revealed by the horizontal analysis prepared in (1). Check My Work Previous Next > All work saved. Email Instructor Save and Exit Submit Assignment for Grading eBook Show Me How Print Item For the Years Ended December 31, 20Y2 and 2041 Increase/(Decrease) 20Y2 20Y1 Amount Percent Sales % Cost of goods sold % Gross profit $ % Selling expenses $ $ $ % Administrative expenses % % Total operating expenses $ % Operating income % Other revenue Income before income tax expense % Income tax expense % Net income % 2. To the extent the data permit, comment on the significant relationships revealed by the horizontal analysis prepared in (1). Net income has from 20Y1 to 20Y2. Sales have ; however, the cost of goods sold has the gross profit to increase at a pace than sales. In addition, total operating expenses have in costs and expenses that are higher than the increase in sales have caused the net income to , causing at a faster rate than sales. Check My Work All work saved. . Email Instructor Save and Exit Submit Assignment for Grading
