The comparative condensed income statements of Emley Corporation are shown below. EMLEY CORPORATION Comparative Condensed Income Statements For the Years Ended December 31 2017 2016 Net sales $726,000 $661,000 Cost of goods sold 531,300 462,000 Gross profit 194,700 199,000 Operating expenses 137,500 132,000 Net income $ 57,200 $ 67,000 (a) Prepare a horizontal analysis of the income statement data for Emley Corporation using 2016 as a base. (Enter negative amounts and percentages using either a negative sign preceding the number e.g. -45, -45% or parentheses e.g. (45), (45%). Round percentages to 1 decimal place, e.g. 12.3%.) EMLEY CORPORATION Condensed Income Statements Increase or (Decrease) During 2017 2017 2016 Amount Percentage Net sales $726,000 $661,000 $ % Cost of goods sold 531,300 462,000 % Gross profit 194,700 199,000 % Operating expenses 137,500 132,000 % Net income $57,200 $67,000 $ % (b) Prepare a vertical analysis of the income statement data for Emley Corporation in columnar form for both years. (Round percentages to 1 decimal place, e.g. 12.3%.) EMLEY CORPORATION Condensed Income Statements 2017 2016 Amount Percent Amount Percent Net sales $726,000 % $661,000 % Cost of goods sold 531,300 % 462,000 % Gross profit 194,700 % 199,000 % Operating expenses 137,500 % 132,000 % Net income $ 57,200 % $ 67,000 %

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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The comparative condensed income statements of Emley Corporation are shown below.

EMLEY CORPORATION Comparative Condensed Income Statements For the Years Ended December 31
	2017	2016
Net sales	$726,000		$661,000
Cost of goods sold	531,300		462,000
Gross profit	194,700		199,000
Operating expenses	137,500		132,000
Net income	$ 57,200		$ 67,000

(a)

Prepare a horizontal analysis of the income statement data for Emley Corporation using 2016 as a base. (Enter negative amounts and percentages using either a negative sign preceding the number e.g. -45, -45% or parentheses e.g. (45), (45%). Round percentages to 1 decimal place, e.g. 12.3%.)

EMLEY CORPORATION Condensed Income Statements
			Increase or (Decrease) During 2017
	2017	2016	Amount	Percentage
Net sales	$726,000	$661,000	$	%
Cost of goods sold	531,300	462,000		%
Gross profit	194,700	199,000		%
Operating expenses	137,500	132,000		%
Net income	$57,200	$67,000	$	%

(b)

Prepare a vertical analysis of the income statement data for Emley Corporation in columnar form for both years. (Round percentages to 1 decimal place, e.g. 12.3%.)

EMLEY CORPORATION Condensed Income Statements
	2017	2016
	Amount	Percent	Amount	Percent
Net sales	$726,000	%	$661,000	%
Cost of goods sold	531,300	%	462,000	%
Gross profit	194,700	%	199,000	%
Operating expenses	137,500	%	132,000	%
Net income	$ 57,200	%	$ 67,000	%

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