Perry's Carpentry Comparative Income Statement For the years ended December 31, 2016, 2015 Increase (+) Decrease (-) % 2016 2015 $'s Revenue Sales Sales Returns and Allowances Net Sales 152,500 2,900 149,600 133,400 2,040 131,360 Cost of Goods Sold Inventory January 1 Net Purchases Cost of Goods for Sale Inventory December 31 Cost of Goods Sold Gross Profit 24,000 104,300 128,300 23,100 105,200 44,400 20,300 86,240 106,540 18,000 88,540 42,820 Operating Expenses Advertising Wages and Salaries Auto expense Depreciation Telephone Utilities Insurance Interest & Bank Charges Total Operating Expenses 1,530 10,700 2,030 1,070 1,390 1,450 1,110 4,510 23,790 1,400 11,590 1,970 1,240 1,110 1,370 965 4,380 24,025 Net income 20,610 18,795 Perry's Carpentry Comparative Income Statement For the years ended December 31, 2016, 2015 2016 2015 Revenue Sales 100% 100% Sales Returns and Allowances 152,500 2,900 149,600 133,400 2,040 131,360 Net Sales Cost of Goods Sold Inventory January 1 Net Purchases Cost of Goods for Sale Inventory December 31 Cost of Goods Sold Gross Profit 24,000 104,300 128,300 23,100 105,200 44,400 20,300 86,240 106,540 18,000 88,540 42,820 Operating Expenses Advertising Wages and Salaries Auto expense Depreciation Telephone Utilities 1,530 10,700 2,030 1,070 1,390 1,450 1,110 4,510 23,790 1,400 11,590 1,970 1,240 1,110 1,370 965 4,380 24,025 Insurance Interest & Bank Charges Total Operating Expenses Net income 20,610 18,795 Perry's Carpentry Comparative Income Statement For the years ended December 31, 2016, 2015 2016 2015 Assets Current Assets Cash Accounts Receivable Inventory Prepaid Expenses Total Current Assets 7,400 3,360 23,100 300 34,160 4,670 3,510 21,000 200 29,380 Capital Equipment Office Equipment Vehicles Land Building Total Capital Equipment 5,600 40,100 50,000 120,000 215,700 4,570 15,000 50,000 120,000 189,570 Total Assets 249,860 100.0% 218,950 100.0% Liabilities Current Liabilities Accounts Payable Total Current Liabilities 1,760 1,760 2,010 2,010 Long-Term Liabilities Long-term bank loan Mortgage Payable Total Long-Term Liabilities 21,400 54,000 75,400 10,000 64,850 64,850 Total Liabilities 77,160 66,860 Owner's Equity 172,700 G. Perry, Capital 152,090 Total Liabilities and Owner's Equity 249,860 100.0% 218,950 100.0% a) Comment on the management's abilitiy to manage the accounts receivable over the past two years. b) What is a possible explanation for the decrease to the Wages and Salaries expense? c) Explain the reason for the increase to the bank loan. d) Comment on the current ratio. e) Using all of the information, make a comment about the company's overall performance over the past two years