Question
Question 27. 27. Comparative income statements for 2012 and 2011 follow (15 points total) 2012 2011 Sales 9,434,000 7,862,000 Cost of Sales 7,075,400 5,660,640 Gross
Question 27. 27. Comparative income statements for 2012 and 2011 follow (15 points total)
| 2012 | 2011 |
Sales | 9,434,000 | 7,862,000 |
Cost of Sales | 7,075,400 | 5,660,640 |
Gross Profit | 2,358,600 | 2,201,360 |
Operating Expenses | 1,376,069 | 1,365,060 |
Operating Income | 982,531 | 836,300 |
Interest Expense | 157,500 | 126,000 |
Earnings Before Tax | 825,031 | 710,300 |
Income Taxes | 396,015 | 317,200 |
Net Income | 429,016 | 393,100 |
a. | Prepare a vertical common-size analysis of this statement for each year. (10 points) |
b. | Explain in plain english (as taught in class) the difference between gross profit in 2011 and 2012 (5 points). |
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