A comparative income statement is given below for McKenzie Sales, Limited, of Toronto: McKenzie Sales, Limited Comparative Income Statement This Year Sales Cost of goods sold $ 7,320,000 4,770,000 Last Year $ 5,563,200 3,513,500 Gross margin 2,550,000 2,049,700 Selling and administrative expenses: Selling expenses Administrative expenses Total expenses Net operating income 1,398,000 1,076,500 702,500 613,000 2,100,500 1,689,500 Interest expense Net income before taxes 449,500 96,000 360,200 93,000 $ 353,500 $ 267,200 The company's board of directors is surprised to see net income increased by only $86,300 when sales increased by $1,756,800. Required: 1. Express each year's income statement in common-size percentages. Note: Round your percentage answers to 1 decimal place (i.e., 0.1234 should be entered as 12.3). Sales Cost of goods sold Gross margin This Year Last Year % % % % % % Selling and administrative expenses: Selling expenses % % Administrative expenses % % Total selling and administrative expenses % % Net operating income % % Interest expense % % Net income before taxes % %

A comparative income statement is given below for McKenzie Sales, Limited, of Toronto: McKenzie Sales, Limited Comparative Income Statement This Year Sales Cost of goods sold $ 7,320,000 4,770,000 Last Year $ 5,563,200 3,513,500 Gross margin 2,550,000 2,049,700 Selling and administrative expenses: Selling expenses Administrative expenses Total expenses Net operating income 1,398,000 1,076,500 702,500 613,000 2,100,500 1,689,500 Interest expense Net income before taxes 449,500 96,000 360,200 93,000 $ 353,500 $ 267,200 The company's board of directors is surprised to see net income increased by only $86,300 when sales increased by $1,756,800. Required: 1. Express each year's income statement in common-size percentages. Note: Round your percentage answers to 1 decimal place (i.e., 0.1234 should be entered as 12.3). Sales Cost of goods sold Gross margin This Year Last Year % % % % % % Selling and administrative expenses: Selling expenses % % Administrative expenses % % Total selling and administrative expenses % % Net operating income % % Interest expense % % Net income before taxes % %

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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