Revenue and expense data for Young Technologies Inc. are as follows: Year 2 Year 1 Sales $500,000 $440,000 Cost of goods sold 325,000 242,000 Selling
Revenue and expense data for Young Technologies Inc. are as follows:
Year 2 | Year 1 | |
Sales | $500,000 | $440,000 |
Cost of goods sold | 325,000 | 242,000 |
Selling expense | 70,000 | 79,200 |
Administrative expenses | 75,000 | 70,400 |
Income tax expense | 10,500 | 16,400 |
Required:
Question Content Area
a. Prepare an income statement in comparative form, stating each item for both years as an amount and as a percentage of sales. Round percentage amounts to the nearest whole percent.
Year 2 Amount | Year 2 Percent | Year 1 Amount | Year 1 Percent | |
CashGross profitIncome from operations loss on discontinued operations sales | $- Select - | - Select -% | $- Select - | - Select -% |
Cost of goods operations sales profitIncome from continuing operations income tax expenseOperating expenses | - Select - | - Select -% | - Select - | - Select -% |
Gross sold gross on discontinued operations incomeprofitsoperations losses from asset impairmentSalesSupplies | $- Select - | - Select -% | $- Select - | - Select -% |
CashGross profitIncome from operationsIncome tax expenseSelling expenses | - Select - | - Select -% | - Select - | - Select -% |
Administrative expensesCashGross profit income tax expenseOperating expenses | - Select - | - Select -% | - Select - | - Select -% |
Total expenses | $fill in the blank dc5eb4f7202bfe5_26 | fill in the blank dc5eb4f7202bfe5_27% | $fill in the blank dc5eb4f7202bfe5_28 | fill in the blank dc5eb4f7202bfe5_29% |
CashCost of merchandise soldIncome from operationsSalesSupplies | - Select - | - Select -% | - Select - | - Select -% |
CashCost of goods sold gross profit income tax expense sales | - Select - | - Select -% | - Select - | - Select -% |
Net income loss | $- Select - | - Select -% | $- Select - | - Select -% |
Question Content Area
b. Comment on the significant changes disclosed by the comparative income statement.
The vertical analysis indicates that the cost of goods sold as a percent of sales
profit income sold gross
between the two years. Selling and administrative expenses as a percentage of sales
profit income
and income tax expense
decreased increased
. Overall net income as a percent of sales
dropped raised decreased increased decreased increased expenses decreased increased expense sales income
.
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