Amazon.com, Inc. (AMZN) is the largest Internet retailer in the United States. Amazon's income statements through operating income for two recent years are as follows (in millions): Amazon.com, Inc. Income Statements For the Years Ended December 31 (in millions) Year 2 Year 1 Revenues: Product sales $ 94,665 $ 79,268 Service sales 41,322 $ 135,987 27,738 Total revenues. $ 107.006 Operating expenses: $ (88,265) (17,619) $ (71,651) Cost of sales.. Fulfillment.. (13,410) (5,254) Marketing.. Technology and content (7,233) (16,085) (12,540) (1,747) General and administrative.. (2,432) Other operating expense (income), net. Total operating expenses Operating income .. (171) (167) $ (131,801) 4,186 $ (104,773) $ 2,233 a. Prepare a vertical analysis of the two income statements. Round percentages to one decimal place. b. Use the vertical analysis to explain the increase in operating income.

Amazon.com, Inc. (AMZN) is the largest Internet retailer in the United States. Amazon's income statements through operating income for two recent years are as follows (in millions): Amazon.com, Inc. Income Statements For the Years Ended December 31 (in millions) Year 2 Year 1 Revenues: Product sales $ 94,665 $ 79,268 Service sales 41,322 $ 135,987 27,738 Total revenues. $ 107.006 Operating expenses: $ (88,265) (17,619) $ (71,651) Cost of sales.. Fulfillment.. (13,410) (5,254) Marketing.. Technology and content (7,233) (16,085) (12,540) (1,747) General and administrative.. (2,432) Other operating expense (income), net. Total operating expenses Operating income .. (171) (167) $ (131,801) 4,186 $ (104,773) $ 2,233 a. Prepare a vertical analysis of the two income statements. Round percentages to one decimal place. b. Use the vertical analysis to explain the increase in operating income.

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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