Income statements for Gibson Company for Year 3 and Year 4 follow: GIBSON COMPANY Income Statements...

Transcribed Image Text:

Income statements for Gibson Company for Year 3 and Year 4 follow: GIBSON COMPANY Income Statements Year 4 Sales $200,400 Year 3 $180,400 Cost of goods sold Selling expenses 143,900 121,900 20,600 18,600 Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income 12,200 14,200 3,600 5,600 $180,300 $160,300 20,100 6,300 20,100 3,900 $ 13,800 $ 16,200 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 percentage answers to 1 decimal place. (i.e., 0.234 should be entered as 23.4).) GIBSON COMPANY Horizontal Analysis of Income Statements Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Percentage Change over Year 3 % Net income (loss) % < Required A Required B > Income statements for Gibson Company for Year 3 and Year 4 follow: GIBSON COMPANY Income Statements Year 4 Sales $200,400 Year 3 $180,400 Cost of goods sold Selling expenses 143,900 121,900 20,600 18,600 Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income 12,200 14,200 3,600 5,600 $180,300 $160,300 20,100 6,300 20,100 3,900 $ 13,800 $ 16,200 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 percentage answers to 1 decimal place. (i.e., 0.234 should be entered as 23.4).) GIBSON COMPANY Horizontal Analysis of Income Statements Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Percentage Change over Year 3 % Net income (loss) % < Required A Required B >