Hello, could someone assist me with answering these questions?
D E 1. Many of Choice Hotels Income Statement accounts have remained consistent for the past 3 years. However, there is a notable difference from 2017 to 2018 in the G H Depreciation Amortization expense. What caused this difference? Hint: See page 44 in the 10-K report. page 44 of the 10-K report. 2. In comparing year-over-year expenses, there is a new expense reported in 2018 called Impairment of Goodwill. What is this expense and why did it occur? Hint: See 3. There is a significant decrease in income taxes in 2018 from previous years. What caused this decrease in income taxes? Hint: See page 45 of the 10-K report. 4. The largest item in revenue and in expense is Marketing and reservation system. What are these two items and why are the numbers different? Hint: See page 56 in the MD&A 5. What are the two most significant trends based on your horizontal analysis over this 3 year period? Explain your reasons for your selections.Horizontal Analysis 12 Months Ended Consolidated Statements of Income - USD ($) Dec. 31, 2018 REVENUES: Dec. 31, 2017 Dec. 31, 2016 $ Change 2017 to 2018% Change 2017 to 2018$ Change 2016 to 201 % Change 2016 to 2 Royalty fees $376,676,000 Initial franchise and relicensing fees $341,745,000 $317,699,000 $26,072,000 $23,038,000 Procurement services $19,720,000 $52,088,000 $40,451,000 Marketing and reservation system $35,844,000 $543,677,000 $499,625,000 Other $409,120,000 $42,791,000 $36,438,000 $25,526,000 Total revenues $1,041,304,000 $941,297,000 $807,909,000 OPERATING EXPENSES: Selling, general and administrative $170,027,000 $165,821,000 $154,720,000 Depreciation and amortization $14,330,000 $6,680,00 $6,996,000 Marketing and reservation system $534,266,000 $479,400,000 $459,765,000 Total operating expenses $718,623,000 $651,901,000 $621,481,000 Impairment of goodwill -$4,289,000 SO Gain on sale of assets, net $82,000 $257,000 $627,000 Operating income $318,474,000 $289,653,000 $187,055,000 OTHER INCOME AND EXPENSES, NET: Interest expense $45,908,000 $45,039,000 $44,446,000 Interest income $7,452,000 $5,920,000 -$3,535,000 Other (gain) loss $ 1,437,000 $3,229,000 $1,504,000 Equity in net (income) loss of affiliates $5,323,000 $4,546,000 -$492,000 Total other income and expenses, net $45,216,000 $40,436,000 $38,915,000 Income before income taxes $273,258,000 $249,217,000 $148,140,000 Income taxes $56,903,000 $126,890,000 $41,428,000 Net income $216,355,000 $122,327,000 $106,712,000 Basic earnings per share: Basic earnings per share (in dollars per share) $3.83 $2.16 $1.90 Diluted earnings per share (in dollars per share $3.80 $2.15 $1.89 Questions: 1. Many of Choice Hotels Income Statement accounts have remained consistent for the past 3 years. However, there is a notable difference from 2017 to 2018 in the Depreciation Amortization expense. What caused this difference? Hint: See page 44 in the 10-K report.
