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Identify any favorable and unfavorable trends in the following income statements by preparing a vertical analysis.   (Round percentages to two decimal places.)                                                      Year 2                          Year 1 Revenues $394,000 $212,500 Operating expenses: Wages expense $ 79,000 $ 65,000 Rent expense 19,000 18,000 Utilities expense 21,000 14,200 Interest expense 7,500 7,800 Total operating expenses $126,500 $105,000 Net income $267,500 $107,500

Identify any favorable and unfavorable trends in the following income statements by preparing a vertical analysis.   (Round percentages to two decimal places.)                                                      Year 2                          Year 1 Revenues $394,000 $212,500 Operating expenses: Wages expense $ 79,000 $ 65,000 Rent expense 19,000 18,000 Utilities expense 21,000 14,200 Interest expense 7,500 7,800 Total operating expenses $126,500 $105,000 Net income $267,500 $107,500

FINANCIAL ACCOUNTING
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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Identify any favorable and unfavorable trends in the following income statements by preparing a vertical analysis.   (Round percentages to two decimal places.)

 
 

 

                                               Year 2

                         Year 1

Revenues

$394,000

$212,500

Operating expenses:

Wages expense

$ 79,000

$ 65,000

Rent expense

19,000

18,000

Utilities expense

21,000

14,200

Interest expense

7,500

7,800

Total operating expenses

$126,500

$105,000

Net income

$267,500

$107,500
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