income statement

Ch 17-3 Exercises and Problems Vertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous Year $398,000 Sales Cost of goods sold Selling expenses 202,980 $463,000 263,910 78,710 87,970 79,600 67,660 Administrative expenses Income tax expense 13,890 19,900 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Current year Currekt year Percent Previous year Amount Amount $463,000 $398,000 263,910 202,980 Previous year Percent Sales Cost of goods sold Selling expenses 78,710 79,600 Administrative expenses 87,970 67,660 Ch 17-3 Exercises and Problems a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Current year Current year Percent | Previous year Amount Amount $463,000 100 $398,000 263,910 202,980 Previous year Percent Sales Cost of goods sold Selling expenses 78,710 79,600 Administrative expenses 87,970 67,660 Income tax expense 13,890 19,900 b. The vertical analysis indicates that the cost of goods sold as a percent of sales 6 percentage points, while selling expenses by 3 percentage points, and administrative expenses by 2 percentage points. Thus, net income as a percent of sales by 3 percentage points. Check My Work 2 more Check My Work uses remaining, Next >