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Sundahl Companys income statements for the past 2 years are as follows: Sundahl Company Income Statements For the Years 1 and 2 1 Year 1
Sundahl Companys income statements for the past 2 years are as follows:
Sundahl Company |
Income Statements |
For the Years 1 and 2 |
1 |
| Year 1 | Year 2 |
2 | Sales | $2,000,000.00 | $1,800,000.00 |
3 | Less: Cost of goods sold | (1,400,000.00) | (1,200,000.00) |
4 | Gross margin | $600,000.00 | $600,000.00 |
5 | Less operating expenses: |
|
|
6 | Selling expenses | $(300,000.00) | $(300,000.00) |
7 | Administrative expenses | (100,000.00) | (110,000.00) |
8 | Operating income | $200,000.00 | $190,000.00 |
9 | Less: |
|
|
10 | Interest expense | (50,000.00) | (40,000.00) |
11 | Income before taxes | $150,000.00 | $150,000.00 |
Required: | |
1. | Prepare a common-size income statement for Year 1 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) |
2. | Prepare a common-size income statement for Year 2 by expressing each line item as a percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) |
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