Exercise 13-3A (Algo) Horizontal and vertical analysis LO 13-1 Income statements for Baird Company for Year 3 and Year 4 follow: BAIRD COMPANY Income Statements Year 4 Year 3 Sales $ 201,800 $ 181,800 Cost of goods sold 143,700 121,700 Selling expenses 20,500 18,500 Administrative expenses 12,700 14,700 Interest expense 4,000 6,000 Total expenses 180,900 160,900 Income before taxes 20,900 20,900 Income taxes expense 5,600 3,600 Net income $ 15,300 $ 17,300 Required Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
Exercise 13-3A (Algo) Horizontal and vertical analysis LO 13-1 Income statements for Baird Company for Year 3 and Year 4 follow: BAIRD COMPANY Income Statements Year 4 Year 3 Sales $ 201,800 $ 181,800 Cost of goods sold 143,700 121,700 Selling expenses 20,500 18,500 Administrative expenses 12,700 14,700 Interest expense 4,000 6,000 Total expenses 180,900 160,900 Income before taxes 20,900 20,900 Income taxes expense 5,600 3,600 Net income $ 15,300 $ 17,300 Required Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Exercise 13-3A (Algo) Horizontal and vertical analysis LO 13-1
Income statements for Baird Company for Year 3 and Year 4 follow:
| BAIRD COMPANY
Income Statements |
||
| Year 4 | Year 3 | |
|---|---|---|
| Sales | $ 201,800 | $ 181,800 |
| Cost of goods sold | 143,700 | 121,700 |
| Selling expenses | 20,500 | 18,500 |
| Administrative expenses | 12,700 | 14,700 |
| Interest expense | 4,000 | 6,000 |
| Total expenses | 180,900 | 160,900 |
| Income before taxes | 20,900 | 20,900 |
| Income taxes expense | 5,600 | 3,600 |
| Net income | $ 15,300 | $ 17,300 |
Required
- Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4.
- Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
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