## Educational Resource: Understanding the Condensed Income StatementA condensed income statement provides a summary of a company's financial performance over a specific period. Here, we have a comparison between the years 2022 and 2021, showcasing various financial metrics.### Key Components of the Condensed Income Statement1. **Net Sales**: This represents the total revenue from goods sold or services provided, minus returns, allowances, and discounts. - 2022: $840,000 - 2021: $610,0002. **Cost of Goods Sold (COGS)**: The direct costs attributable to the production of the goods sold by the company. - 2022: $540,120 - 2021: $405,6503. **Gross Profit**: Calculated as Net Sales minus COGS, representing the profit a company makes after deducting the costs associated with making and selling its products. - 2022: $299,880 - 2021: $204,3504. **Selling Expenses**: Costs incurred to sell products and services, such as advertising and promotion charges. - 2022: $133,560 - 2021: $80,5205. **Administrative Expenses**: Overhead costs related to the general operation of the company that are not directly tied to producing goods or services. - 2022: $57,120 - 2021: $46,9706. **Total Operating Expenses**: The sum of Selling Expenses and Administrative Expenses. - 2022: $190,680 - 2021: $127,4907. **Income Before Income Taxes**: This is the profit before deducting taxes, calculated as Gross Profit minus Total Operating Expenses. - 2022: $109,200 - 2021: $76,8608. **Income Tax Expense**: Taxes payable on the income earned. - 2022: $31,920 - 2021: $26,8409. **Net Income**: The final profit after all expenses, including taxes, have been deducted. - 2022: $77,280 - 2021: $50,020### Understanding Percent CalculationFor comprehensive financial analysis, percentages can be calculated based on the respective amounts to understand ### Operating Data for Grouper Corp.Below is the operating data for Grouper Corp. for the years 2022 and 2021.| **Item** | **2022** | **2021** ||------------------------|----------|----------|| **Net sales** | $840,000 | $610,000 || **Cost of goods sold** | $540,120 | $405,650 || **Selling expenses** | $133,560 | $80,520 || **Administrative expenses** | $57,120 | $46,970 || **Income tax expense** | $31,920 | $26,840 || **Net income** | $77,280 | $50,020 |**Instructions:**Prepare a schedule showing a vertical analysis for 2022 and 2021. (Round percentages to 1 decimal place, e.g., 12.1%). **Note:** Vertical analysis involves converting each line item on the financial statement to a percentage of a base figure for that statement, which, in the case of the income statement, is typically net sales.

The Statement of Income -The statement of comprehensive income is the profit earned and loss…

Current Attempt in Progress Operating data for Grouper Corp. are presented as follows. Net sales Cost of goods sold Selling expenses Administrative expenses Income tax expense Net income 2022 $840,000 540,120 133,560 57,120 31,920 77,280 2021 $610,000 405,650 80,520 46,970 26,840 50,020 Prepare a schedule showing a vertical analysis for 2022 and 2021. (Round percentages to 1 decimal place, e.g. 12.1%.)

Current Attempt in Progress Operating data for Grouper Corp. are presented as follows. Net sales Cost of goods sold Selling expenses Administrative expenses Income tax expense Net income 2022 $840,000 540,120 133,560 57,120 31,920 77,280 2021 $610,000 405,650 80,520 46,970 26,840 50,020 Prepare a schedule showing a vertical analysis for 2022 and 2021. (Round percentages to 1 decimal place, e.g. 12.1%.)

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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