Preparing Common Size StatementsThe financial statements for Venus Industries follow:Venus IndustriesConsolidated Income Statements(in thousands, except per share data) Year ended December 31, 202320222021Revenues$4,578,041$3,864,324$3,003,610Costs and expenses: Cost of goods sold$2,227,189$2,089,089$2,005,691Selling and administrative922,261836,212664,061Interest29,74432,96630,472Other expenses (income)1,4752,141(43)Total costs and expenses$3,180,669$2,960,408$2,700,181Income before income taxes$1,397,372$903,916$303,429Income taxes229,500192,600174,700Net income$1,167,872$711,316$128,729Venus IndustriesConsolidated Balance Sheets (in thousands) December 31,ASSETS20232022Current assets: Cash and equivalents$291,284$260,050Accounts receivable, less allowance for doubtful accounts of $19,447 and $20,046826,977616,064Inventories592,986512,917Deferred income taxes26,37828,355Prepaid expenses40,66332,977Total current assets$1,778,288$1,450,363Property, plant, and equipment$571,032$497,795Less accumulated depreciation(193,037)(151,758)Net property, plant, and equipment$377,995$346,037Goodwill174,326110,363Other assets30,92724,701Total assets$2,361,536$1,931,464LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Current portion of long-term debt$52,985$3,652Notes payable108,165105,696Accounts payable135,701134,729Accrued liabilities138,563134,089Income taxes payable17,15042,422Total current liabilities$452,564$420,588Long-term debt15,03377,022Noncurrent deferred income taxes29,96527,074Other noncurrent liabilities43,57523,728Commitments and contingencies00Redeemable preferred stock300300Total liabilities$541,437$548,712Stockholders’ equity: Common stock at stated value: Class A convertible—26,691 and 26,919 shares outstanding$155$161Class B—49,161 and 48,591 shares outstanding2,7202,716Capital in excess of stated value108,45193,799Treasury stock (common at cost)(7,790)(6,860)Retained earnings1,716,5631,292,936Total stockholders’ equity$1,820,099$1,382,752Total liabilities and stockholders’ equity$2,361,536$1,931,464 Required:Question Content Area1. Prepare common size income statements to be used for horizontal analysis for Venus for 2021 to 2023. Enter your answers in percentage terms, rounded to two decimal places, and do not include the "%" sign with your answer. For example, "100.00" or "28.72". Utilize 2021 as the base year for both 2022 and 2023. You do not need to include the actual dollar amounts shown above.

Common size statement is a part of horizontal analysis of financial statement analysis in which…

Answered: Prepare common size income statements…

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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Preparing Common Size Statements

The financial statements for Venus Industries follow:

Venus Industries Consolidated Income Statements (in thousands, except per share data)
	Year ended December 31,
	2023	2022	2021
Revenues	$4,578,041	$3,864,324	$3,003,610
Costs and expenses:
Cost of goods sold	$2,227,189	$2,089,089	$2,005,691
Selling and administrative	922,261	836,212	664,061
Interest	29,744	32,966	30,472
Other expenses (income)	1,475	2,141	(43)
Total costs and expenses	$3,180,669	$2,960,408	$2,700,181
Income before income taxes	$1,397,372	$903,916	$303,429
Income taxes	229,500	192,600	174,700
Net income	$1,167,872	$711,316	$128,729

Venus Industries Consolidated Balance Sheets (in thousands)
	December 31,
ASSETS	2023	2022
Current assets:
Cash and equivalents	$291,284	$260,050
Accounts receivable, less allowance for doubtful accounts of $19,447 and $20,046	826,977	616,064
Inventories	592,986	512,917
Deferred income taxes	26,378	28,355
Prepaid expenses	40,663	32,977
Total current assets	$1,778,288	$1,450,363
Property, plant, and equipment	$571,032	$497,795
Less accumulated depreciation	(193,037)	(151,758)
Net property, plant, and equipment	$377,995	$346,037
Goodwill	174,326	110,363
Other assets	30,927	24,701
Total assets	$2,361,536	$1,931,464
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$52,985	$3,652
Notes payable	108,165	105,696
Accounts payable	135,701	134,729
Accrued liabilities	138,563	134,089
Income taxes payable	17,150	42,422
Total current liabilities	$452,564	$420,588
Long-term debt	15,033	77,022
Noncurrent deferred income taxes	29,965	27,074
Other noncurrent liabilities	43,575	23,728
Commitments and contingencies	0	0
Redeemable preferred stock	300	300
Total liabilities	$541,437	$548,712
Stockholders’ equity:
Common stock at stated value:
Class A convertible—26,691 and 26,919 shares outstanding	$155	$161
Class B—49,161 and 48,591 shares outstanding	2,720	2,716
Capital in excess of stated value	108,451	93,799
Treasury stock (common at cost)	(7,790)	(6,860)
Retained earnings	1,716,563	1,292,936
Total stockholders’ equity	$1,820,099	$1,382,752
Total liabilities and stockholders’ equity	$2,361,536	$1,931,464

Required:

Question Content Area

1. Prepare common size income statements to be used for horizontal analysis for Venus for 2021 to 2023. Enter your answers in percentage terms, rounded to two decimal places, and do not include the "%" sign with your answer. For example, "100.00" or "28.72". Utilize 2021 as the base year for both 2022 and 2023. You do not need to include the actual dollar amounts shown above.

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