For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $16,000 for advertising. At the end of the year, Ahmad Rashad, the president, is presented with the following condensed comparative income statement: Sales Cost of goods sold Gross profit Selling expenses Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 Administrative expenses Total operating expenses Income from operations Other revenue Income before income tax Income tax expense Net income Required $576,000 264,960 $311,040 $109,440 57,600 $167,040 $144,000 23,040 $167,040 69,120 $97,920 2011 $495,000 247,500 $247,500 $89,100 59,400 $148,500 $99,000 24,750 $123,750 49,500 $74,250 Required: Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round to the nearest "whole" percentage. Enter all amounts as positive numbers.

For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $16,000 for advertising. At the end of the year, Ahmad Rashad, the president, is presented with the following condensed comparative income statement: Sales Cost of goods sold Gross profit Selling expenses Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 Administrative expenses Total operating expenses Income from operations Other revenue Income before income tax Income tax expense Net income Required $576,000 264,960 $311,040 $109,440 57,600 $167,040 $144,000 23,040 $167,040 69,120 $97,920 2011 $495,000 247,500 $247,500 $89,100 59,400 $148,500 $99,000 24,750 $123,750 49,500 $74,250 Required: Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round to the nearest "whole" percentage. Enter all amounts as positive numbers.

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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Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous YearSales $4,000,000 $3,600,000Cost of goods sold 2,280,000 1,872,000Selling expenses 600,000 648,000Administrative expenses 520,000 360,000Income tax expense 240,000 216,000a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. Round to the nearest whole percentage.b. Comment on the significant changes disclosed by the comparative income statement.
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