Income statements for Munoz Company for Year 3 and Year 4 follow:

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.

Income statements for Munoz Company for Year 3 and Year 4 follow: MUNOZ COMPANY Income Statements Year 4 Sales $200,500 Cost of goods sold 142,200 Selling expenses 20,900 Administrative expenses 12,800 Interest expense 3,600 Total expenses $179,500 Income before taxes 21,000 Income taxes expense 5,200 Net income $ 15,800 Year 3 $180,500 120, 200 18,900 14,800 5,600 $159,500 21,000 3,500 $ 17,500 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., 0.234 should be entered as 23.4).) MUNOZ 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 Required B > Income statements for Munoz Company for Year 3 and Year 4 follow: MUNOZ COMPANY Income Statements Year 4 Sales $200,500 Cost of goods sold 142, 200 Selling expenses 20,900 Administrative expenses 12,800 Interest expense 3,600 Total expenses $179,500 Income before taxes 21,000 Income taxes expense 5,200 Net income $ 15,800 Year 3 $180,500 120,200 18,900 14,800 5,600 $159,500 21,000 3,500 $ 17,500 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 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. (.e., 0.234 should be entered as 23.4).) MUNOZ 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 % %