A comparative income statement is given below for McKenzie Sales, Limited, of Toronto: McKenzie Sales, Limited Comparative Income Statement Sales. Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total expenses Net operating income Interest expense Net income before taxes This Year $ 7,350,000 4,610,000 2,740,000 1,390,000 706,000 2,096,000 644,000 101,000 $ 543,000 Last Year $ 5,586,000 3,511,500 2,074,500 1,079,500 613,500 1,693,000 381,500 87,000 $ 294,500 Members of the company's board of directors are surprised to see that net income increased by only $248,500 when sales increased by $1,764,000. Required: 1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)
A comparative income statement is given below for McKenzie Sales, Limited, of Toronto: McKenzie Sales, Limited Comparative Income Statement Sales. Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total expenses Net operating income Interest expense Net income before taxes This Year $ 7,350,000 4,610,000 2,740,000 1,390,000 706,000 2,096,000 644,000 101,000 $ 543,000 Last Year $ 5,586,000 3,511,500 2,074,500 1,079,500 613,500 1,693,000 381,500 87,000 $ 294,500 Members of the company's board of directors are surprised to see that net income increased by only $248,500 when sales increased by $1,764,000. Required: 1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)
College Accounting (Book Only): A Career Approach
12th Edition
ISBN:9781305084087
Author:Cathy J. Scott
Publisher:Cathy J. Scott
Chapter12: Financial Statements, Closing Entries, And Reversing Entries
Section: Chapter Questions
Problem 3E
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Question
![Sales
Cost of goods sold
Gross margin
Selling and administrative expenses:
Selling expenses
Administrative expenses
Total selling and administrative expenses
Net operating income
Interest expense
Net income before taxes
This Year
28
%
%
0.0 %
%
%
0.0 %
0.0 %
%
0.0 %
Last Year
%
%
0.0 %
%
%
0.0 %
0.0 %
do
%
0.0 %](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5b615404-0c2e-4c14-9e8f-ced24275ac10%2Fa4a25670-c601-4d2c-96dd-9de61599cb27%2Fe8n3esu_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Sales
Cost of goods sold
Gross margin
Selling and administrative expenses:
Selling expenses
Administrative expenses
Total selling and administrative expenses
Net operating income
Interest expense
Net income before taxes
This Year
28
%
%
0.0 %
%
%
0.0 %
0.0 %
%
0.0 %
Last Year
%
%
0.0 %
%
%
0.0 %
0.0 %
do
%
0.0 %
![A comparative income statement is given below for McKenzie Sales, Limited, of Toronto:
McKenzie Sales, Limited
Comparative Income Statement
Sales
Cost of goods sold
Gross margin
Selling and administrative expenses:
Selling expenses
Administrative expenses
Total expenses
Net operating income
Interest expense
Net income before taxes
This Year
$ 7,350,000
4,610,000
2,740,000
1,390,000
706,000
2,096,000
644,000
101,000
$ 543,000
Last Year
$ 5,586,000
3,511,500
2,074,500
1,079,500
613,500
1,693,000
381,500
87,000
$ 294,500
Members of the company's board of directors are surprised to see that net income increased by only $248,500 when sales increased
by $1,764,000.
Required:
1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e.,
0.1234 should be entered as 12.3).)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5b615404-0c2e-4c14-9e8f-ced24275ac10%2Fa4a25670-c601-4d2c-96dd-9de61599cb27%2Fwqbokyr_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A comparative income statement is given below for McKenzie Sales, Limited, of Toronto:
McKenzie Sales, Limited
Comparative Income Statement
Sales
Cost of goods sold
Gross margin
Selling and administrative expenses:
Selling expenses
Administrative expenses
Total expenses
Net operating income
Interest expense
Net income before taxes
This Year
$ 7,350,000
4,610,000
2,740,000
1,390,000
706,000
2,096,000
644,000
101,000
$ 543,000
Last Year
$ 5,586,000
3,511,500
2,074,500
1,079,500
613,500
1,693,000
381,500
87,000
$ 294,500
Members of the company's board of directors are surprised to see that net income increased by only $248,500 when sales increased
by $1,764,000.
Required:
1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e.,
0.1234 should be entered as 12.3).)
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