Using a vertical analysis prepare an income statement

Comparative Balance Sheet December 31, 2018 and 2017 2018 2017 Assets Current Assets: Cash Accounts Receivable, Net Merchandise Inventory Prepaid Rent Total Current Assets TS $ $ $ $ $ 75,000 150,000 130,000 30,000 385,000 97,000 100,000 60,000 10,000 267,000 $ Property. Plant, and Equipment: Equipment Less: Accumulated Depreciation - Equipment Total Property, Plant, and Equipment s Total Assets $ $ 435,000 (80,000) 355,000 740,000 $ S $ $ 208,000 (52,400) 155,600 422,600 $ 2018 2017 Liabilities and Stockholders' Equity Current Liabilities: Accounts Payable Unearned Revenue Salaries Payable Federal Income Taxes Payable Total Current Liabilities $ $ $ $ $ $ 84,000 42,000 50,000 10,000 186,000 110,150 50,000 33,000 10,000 203,150 $ $ Long Term Liabilities Note Payable Total Long-Term Liabilities Total Liabilities $ $ $ 120,000 120,000 306,000 $ $ 5 203,150 Stockholders' Equity: Common Stock, $1 Par Paid-In Capital in Excess of Par Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Equity $ $ $ 163.000 18,000 253,000 4 34,000 740,000 $ $ $ $ $ 54,300 18,000 147,150 219,450 422,600 S $ 3 Page Comparative Statement of Income For the Years Ended December 31, 2018 and 2017 2018 2017 S 1.200,000 $ 650,000 $ 550,000 $ 850,000 $ 500,000 S 350,000 Sales Cost of Goods Sold Gross Margin Operating Expenses: Salaries and Wages Expense Rent Expense Depreciation Expense Total Operating Expenses Income from Operations Gain on Sale of Equipment Interest Expense Increase (Decrease) in I Operating Income Income before Taxes Federal Income Taxes 30% Net Income $ 125,000 $ 25,000 $ 30,000 $ 180,000 $ 370,000 $ 4,500 (8,000) (3,500) $ $ $ $ $ $ $ $ 100,000 25,000 18,000 143,000 207,000 0 (6,500) (6,500) S S $ $ $ 366,500 109,950 256,550 $ $ $ 200,500 60,150 140,350 Statement of Retained Earnings 2018 Carlo's Crazy Cars Comparative Statement of Retained Earnings For the Years Ended December 31, 2018 and 2017 2017 Retained Earnings, $ 147,150 $ 100,650 Beginning of Year Net Income S 256,550 $ 140,350 Less: Dividends $ 150,700 $ 93,850 Retained Earnings, End of $ 253,000 $ 147,150 Year 1. Equipment with a cost of $15,000 on which depreciation has been recorded was sold for cash. Equipment was purchased using cash and a long-term note payable. 2. Stock was issued for cash. 3. Dividends were paid in cash. 41 Page