Homework Help is Here – Start Your Trial Now!
Business
Accounting
Perform a horizontal analysis for the entry "Gross Sales" shown on the income statement portion below. (Round percentages to one decimal place Increase/Decrease Revenue 2019 2018 Amount Percent Gross Sales $277,000 $200,500 $ Less: Sales Returns 14,200 12,400 and Allowances 262,800 188,100 Cost of Goods Sold 31,900 33,800 60,300 55,500 92,200 89,300 43,000 60,200 49,200 29,100 213,600 159,000 Net Sales Merchandise Inventory Net Purchases Goods Available for Sale Less: Merchandise Inventory, Dec. 31 Cost of Goods Sold Gross Margin %

Perform a horizontal analysis for the entry "Gross Sales" shown on the income statement portion below. (Round percentages to one decimal place Increase/Decrease Revenue 2019 2018 Amount Percent Gross Sales $277,000 $200,500 $ Less: Sales Returns 14,200 12,400 and Allowances 262,800 188,100 Cost of Goods Sold 31,900 33,800 60,300 55,500 92,200 89,300 43,000 60,200 49,200 29,100 213,600 159,000 Net Sales Merchandise Inventory Net Purchases Goods Available for Sale Less: Merchandise Inventory, Dec. 31 Cost of Goods Sold Gross Margin %

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
horizontal analysis
### Horizontal Analysis of Gross Sales **Objective:** Perform a horizontal analysis for the entry "Gross Sales" shown on the income statement portion below. Round percentages to one decimal place. #### Income Statement Analysis | Revenue | 2019 | 2018 | Increase/Decrease | Percent | |---------------------------------|-----------|-----------|-------------------|---------| | **Gross Sales** | $277,000 | $200,500 | | | | Less: Sales Returns and Allowances | 14,200 | 12,400 | | | | **Net Sales** | 262,800 | 188,100 | | | | **Cost of Goods Sold** | | | | | | Merchandise Inventory | 31,900 | 38,800 | | | | Net Purchases | 60,300 | 55,500 | | | | Goods Available for Sale | 92,200 | 89,300 | | | | Less: Merchandise Inventory (Dec. 31) | 48,000 | 60,200 | | | | **Cost of Goods Sold** | 49,200 | 29,100 | | | | **Gross Margin** | 213,600 | 159,000 | | | #### Explanation of Analysis Table: - **Revenue:** - **Gross Sales:** Represents total sales before deductions for returns and allowances. - **Net Sales:** Calculated by subtracting Sales Returns and Allowances from Gross Sales. - **Cost of Goods Sold:** - **Merchandise Inventory (Opening):** Inventory at the beginning of the period. - **Net Purchases:** Total purchases minus any returns or allowances. - **Goods Available for Sale:** Sum of Merchandise Inventory and Net Purchases. - **Merchandise Inventory (Closing):** Inventory at the end of the period. - **Cost of Goods Sold (COGS):** Calculated by subtracting the closing inventory from Goods Available for Sale. - **Gross Margin:** Net Sales minus Cost of Goods Sold, representing the profit made before deducting operating expenses. ### Graphs/Diagrams: The dataset does not include any graphs or diagrams. However, for educational purposes
Transcribed Image Text:### Horizontal Analysis of Gross Sales **Objective:** Perform a horizontal analysis for the entry "Gross Sales" shown on the income statement portion below. Round percentages to one decimal place. #### Income Statement Analysis | Revenue | 2019 | 2018 | Increase/Decrease | Percent | |---------------------------------|-----------|-----------|-------------------|---------| | **Gross Sales** | $277,000 | $200,500 | | | | Less: Sales Returns and Allowances | 14,200 | 12,400 | | | | **Net Sales** | 262,800 | 188,100 | | | | **Cost of Goods Sold** | | | | | | Merchandise Inventory | 31,900 | 38,800 | | | | Net Purchases | 60,300 | 55,500 | | | | Goods Available for Sale | 92,200 | 89,300 | | | | Less: Merchandise Inventory (Dec. 31) | 48,000 | 60,200 | | | | **Cost of Goods Sold** | 49,200 | 29,100 | | | | **Gross Margin** | 213,600 | 159,000 | | | #### Explanation of Analysis Table: - **Revenue:** - **Gross Sales:** Represents total sales before deductions for returns and allowances. - **Net Sales:** Calculated by subtracting Sales Returns and Allowances from Gross Sales. - **Cost of Goods Sold:** - **Merchandise Inventory (Opening):** Inventory at the beginning of the period. - **Net Purchases:** Total purchases minus any returns or allowances. - **Goods Available for Sale:** Sum of Merchandise Inventory and Net Purchases. - **Merchandise Inventory (Closing):** Inventory at the end of the period. - **Cost of Goods Sold (COGS):** Calculated by subtracting the closing inventory from Goods Available for Sale. - **Gross Margin:** Net Sales minus Cost of Goods Sold, representing the profit made before deducting operating expenses. ### Graphs/Diagrams: The dataset does not include any graphs or diagrams. However, for educational purposes
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 2 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Horizontal Analysis
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS