comparative income statements of ArabManufacturing Company are shown below.2019$38,610 $32,175 $25,74020202018Net sales25,100 19,950S13,510 S12,225 $10,3407,7004,270Cost of sales15,400Gross profitSelling expenses6,5655,148Administrative4.1753,861expensesTotal operatingS11,970 $10,740 $9.009expensesOperatingS 1,540 S1,485 $1,331incomeInterest expense11595100Net incomeS 1,425 S 1,390 $1,231before tax655645S 770 S 745541$ 690Income taxesNet incomeRequired:a. Perform a vertical, common size analysis of theincome statement data for Arab ManufacturingCompany in columnar form, using sales as thebase.b. Comment briefly on significant trends andrelationships revealed by the computations. :52 PM

Vertical analysis compares two amounts of a same period. In Vertical analysis, a figure is taken as…

comparative income statements of Arab Manufacturing Company are shown below. 2019 2020 $38,610 $32,175 $25,740 25,100 19,950 S13,510 S12,225 $10,340 7,700 4,270 2018 Net sales Cost of sales 15,400 Gross profit Selling expenses Administrative 6,565 5,148 4,175 3,861 expenses Total operating S11,970 $10,740 $ 9,009 expenses Operating S 1,540 S1,485 $ 1,331 income Interest expense 95 S 1,231 115 100 Net income S 1,425 S 1,390 before tax Income taxes 655 645 $ 770 $ 745 541 $ 690 Net income Required: a. Perform a vertical, common size analysis of the income statement data for Arab Manufacturing Company in columnar form, using sales as the base. b. Comment briefly on significant trends and relationships revealed by the computations.52 PI

comparative income statements of Arab Manufacturing Company are shown below. 2019 2020 $38,610 $32,175 $25,740 25,100 19,950 S13,510 S12,225 $10,340 7,700 4,270 2018 Net sales Cost of sales 15,400 Gross profit Selling expenses Administrative 6,565 5,148 4,175 3,861 expenses Total operating S11,970 $10,740 $ 9,009 expenses Operating S 1,540 S1,485 $ 1,331 income Interest expense 95 S 1,231 115 100 Net income S 1,425 S 1,390 before tax Income taxes 655 645 $ 770 $ 745 541 $ 690 Net income Required: a. Perform a vertical, common size analysis of the income statement data for Arab Manufacturing Company in columnar form, using sales as the base. b. Comment briefly on significant trends and relationships revealed by the computations.52 PI

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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Cochran corporation, Inc. has the following income statement: Cochran corporation, Inc. Income statement For the year ended December 31, 2021 net sales $240 Cost of goods sold $150 gross profit $90 Operating expenses $65 Net income $25 Using vertical analysis, what percentage is assigned to operating expenses? a. 27,1% b. 43.3% c. 72.2% d. 260.0%
Excerpts from TPX Company's December 31, 2021 and 2020, financial statements are presented below: 2021 2020 Accounts receivable $82,000 $81,000 Inventory 90,000 73,000 Net sales 420,000 375,000 Cost of goods sold 260,000 221,000 Total assets 825,000 760,000 Total stockholders' equity 490,000 450,000 Net income 78,000 58,000 TPX Company's 2021 gross profit ratio is: (Round your answer to one decimal place.) Multiple Choice 61.9%. 43.1%. 47.1%. 38.1%.
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Manero Company included the following information in its annual report: 2019 2018 Sales $178,400 $162,500 102,500 Cost of goods sold 115,000 Operating expenses 50,000 50,000 Operating income 13,400 10,000 In a trend income statement for 2017, where 2017 is the base year, sales are expressed as: Multiple Choice 150.5% O100.0% 84,4% 92.6% 2017 $155,500 100,000 45,000 10,500
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