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Exercise 13-3A Horizontal and vertical analysis LO 13-1 Income statements for Zachary Company for Year 3 and Year 4 follow: ZACHARY COMPANY Income Statements Year
Exercise 13-3A Horizontal and vertical analysis LO 13-1
Income statements for Zachary Company for Year 3 and Year 4 follow:
ZACHARY COMPANY Income Statements | |||||||
Year 4 | Year 3 | ||||||
Sales | $ | 201,800 | $ | 181,800 | |||
Cost of goods sold | 143,600 | 121,600 | |||||
Selling expenses | 21,200 | 19,200 | |||||
Administrative expenses | 12,500 | 14,500 | |||||
Interest expense | 3,900 | 5,900 | |||||
Total expenses | $ | 181,200 | $ | 161,200 | |||
Income before taxes | 20,600 | 20,600 | |||||
Income taxes expense | 5,100 | 3,600 | |||||
Net income | $ | 15,500 | $ | 17,000 | |||
Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
Complete this question by entering your answers in the tabs below. Required A Required B Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. (Negative answers should be indicated by a minus sign. Round your answers to 1 decimal place. i.e., .234 should be entered as 23.4).) ZACHARY COMPANY Horizontal Analysis of Income Statements Percentage Change over Year 3 Sales % Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income (loss) % Required A Required B Perform a vertical analysis, showing each income statement component as a percentage of sales for each year. (Percentages may not add exactly due to rounding. Round your answers to 1 decimal place. (i.e., .234 should be entered as 23.4).) ZACHARY COMPANY Vertical Analysis of Income Statements Percentage of Percentage of Sales Year 4 Sales Year 3 Sales % % Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income % %
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