Game-On Sports operates in two distinct segments: athletic equipment and accessories. The income statement for each operating segment is presented below.Required:1. Complete the "%" columns to be used in a vertical analysis of Game-On Sports’ two operating segments. Express each amount as a percentage of sales. (Round your percentage answers to 1 decimal place.)GAME-ON SPORTSIncome StatementFor the Year Ended December 31, 2021 Athletic EquipmentAccessories Amount%Amount%Net sales$2,800,000 $3,250,000 Cost of goods sold1,250,000 1,620,000 Gross profit1,550,000 1,630,000 Operating expenses650,000 700,000 Operating income900,000 930,000 Other income (expense)75,000 (10,000) Income before tax975,000 920,000 Income tax expense225,000 200,000 Net income$750,000 $720,000 2. Use vertical analysis to compare the profitability of the two operating segments. Which segment is more profitable?multiple choiceAthletic equipmentAccessories

Vertical analysis is technique used in financial statements, which is defined as the relationship…

Answered: Game-On Sports operates in two distinct…

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Chapter15: Financial Statement Analysis

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Game-On Sports operates in two distinct segments: athletic equipment and accessories. The income statement for each operating segment is presented below.

Required:
1. Complete the "%" columns to be used in a vertical analysis of Game-On Sports’ two operating segments. Express each amount as a percentage of sales. (Round your percentage answers to 1 decimal place.)

GAME-ON SPORTS
Income Statement
For the Year Ended December 31, 2021
	Athletic Equipment	Accessories
	Amount	%	Amount	%
Net sales	$2,800,000		$3,250,000
Cost of goods sold	1,250,000		1,620,000
Gross profit	1,550,000		1,630,000
Operating expenses	650,000		700,000
Operating income	900,000		930,000
Other income (expense)	75,000		(10,000)
Income before tax	975,000		920,000
Income tax expense	225,000		200,000
Net income	$750,000		$720,000

2. Use vertical analysis to compare the profitability of the two operating segments. Which segment is more profitable?

multiple choice

Athletic equipment
Accessories

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