Refer to the information for Sundahl Company on the previous page.Required:1. Prepare a common-size income statement for Year 1 by expressing each line item as apercentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.)2. Prepare a common-size income statement for Year 2 by expressing each line item as apercentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.) Sundahl Company's income statements for the past 2 years are as follows:Sundahl CompапyIncome StatementsFor the Years 1 and 2Year IYear 2Sales$ 2,000,000$1,800,000Less: Cost of goods sold(1,400,000)$ 600,000(1,200,000)$ 600,000Gross marginLess operating expenses:Selling expenses(300,000)(300,000)(100,000)$ 200,000(50,000)(110,000)$ 190,000(40,000)Administrative expensesOperating incomeLess: Interest expenseIncome before taxes$ 150,000$ 150,000

Name: Refer to the information for Sundahl Company on the previous page.Requ
Uploaded: 2024-03-20T06:32:37.000Z
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Description: Refer to the information for Sundahl Company on the previous page.Required:1. Prepare a common-size income statement for Year 1 by expressing each line item as apercentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.)

A common size balance sheet allows for the relative percentage of each expense as a % of sales…

Answered: Sundahl Company's income statements for…

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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Refer to the information for Sundahl Company on the previous page.
Required:
1. Prepare a common-size income statement for Year 1 by expressing each line item as a
percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.)
2. Prepare a common-size income statement for Year 2 by expressing each line item as a
percentage of sales revenue. (Note: Round percentages to the nearest tenth of a percent.)

Sundahl Company's income statements for the past 2 years are as follows:
Sundahl Compапy
Income Statements
For the Years 1 and 2
Year I
Year 2
Sales
$ 2,000,000
$1,800,000
Less: Cost of goods sold
(1,400,000)
$ 600,000
(1,200,000)
$ 600,000
Gross margin
Less operating expenses:
Selling expenses
(300,000)
(300,000)
(100,000)
$ 200,000
(50,000)
(110,000)
$ 190,000
(40,000)
Administrative expenses
Operating income
Less: Interest expense
Income before taxes
$ 150,000
$ 150,000

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