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Income statement data for Winthrop Company for two recent years ended December 31 are as follows: 1 Current Year Previous Year 2 Sales $2,280,000.00 $2,000,000.00
Income statement data for Winthrop Company for two recent years ended December 31 are as follows:
1 |
| Current Year | Previous Year |
2 | Sales | $2,280,000.00 | $2,000,000.00 |
3 | Cost of goods sold | 1,960,000.00 | 1,750,000.00 |
4 | Gross profit | $320,000.00 | $250,000.00 |
5 | Selling expenses | $156,500.00 | $125,000.00 |
6 | Administrative expenses | 122,000.00 | 100,000.00 |
7 | Total operating expenses | $278,500.00 | $225,000.00 |
8 | Income before income tax | $41,500.00 | $25,000.00 |
9 | Income tax expense | 16,600.00 | 10,000.00 |
10 | Net income | $24,900.00 | $15,000.00 |
A. | Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. Round percentages to one decimal place. |
B. | What conclusions can be drawn from the horizontal analysis? |
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