The following data relate to Alpha Company: 2018 2017 P500,000 P400,000 240,000 200,000 Sales Cost of Goods Sold Gross Profit 20perating Expenses 260,000 200,000 160,000 120,000 Profit 100,000 80,000
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- Income Statement for Year Ended December 31, 2018 (Millions of Dollars) Net sales 795.0 Cost of goods sold 660.0 Gross profit 135.0 Selling expenses 73.5 EBITDA 61.5 Depreciation expenses 12.0 Earnings before interest and taxes (EBIT) 49.5 Interest expenses 4.5 Earnings before taxes (EBT) 45.0 Taxes (40%) 18.0 Net income 27.0 a. Calculate the ratios you think would be useful in this analysis. b. Construct a DuPont equation, and compare the companys ratios to the industry average ratios. c. Do the balance-sheet accounts or the income statement figures seem to be primarily responsible for the low profits? d. Which specific accounts seem to be most out of line relative to other firms in the industry? e. If the firm had a pronounced seasonal sales pattern or if it grew rapidly during the year, how might that affect the validity of your ratio analysis? How might you correct for such potential problems?You are given the following extract of an income statement: Particulars 2018 (OMR) 2019(OMR) Net sales 120,000 180,000 Cost of goods sold 108,000 120,000 Gross profit 12,000 60,000 Administrative expenses 2,500 3,800 What is the percentage change in administrative expenses if a common size statement is preparedMetlock, Inc. has the following Income Statement (in millions): METLOCK, INC. Income Statement For the Year Ended December 31, 2023 Net Sales $178 Cost of Goods Sold 119 Gross Profit 59 Operating Expenses 40 Net Income $ 19 Using vertical analysis, what percentage is assigned to net sales? 100% 50% Can't be computed 150%
- Mac Donald company reported the following on its comparative income statement: 2017 2018 2019 Revenue 9,000 10,000 14,000 Cost of goods sold 6,000 4,000 9,000 Prepare a horizontal analysis of revenue , cost of goods sold and gross profitOperating data for Joshua Corporation are presented as follows: Net Sales Cost of Goods Sold Selling Expenses Administrative Expenses Income Tax Expense Net Income 2022 800,000 520,000 120,000 60,000 30,000 70,000 Instructions Prepare a schedule showing a vertical analysis for 2022 and 2021. Net Sales Cost of Goods Sold Gross Profit Selling Expenses Your Answers: FYI: Format the percent cols to one decimal place. Ex 99.9% 2022 Administrative Expenses Total Operating Expenses Income Before Income Taxes Income Tax Expense Net Income 2021 600,000 408,000 72,000 48,000 24,000 48,000 Amount 800,000 520,000 280,000 120,000 60,000 180,000 100,000 30,000 70,000 Percent 100.0% 2021 Amount Percent 600,000 100.0% 408,000 192,000 72,000 48,000 120,000 72,000 24,000 48,000Use the given statement of comprehensive income below in answering the question. DEF Company, Income Statement 2021 2020 Sales P10,200.00 P9,600.00 Cost of Goods Sold P3,000.00 P2,600.00 Gross Profit P7,200.00 P7,000.00 Operating Expenses P2,400.00 P2,200.00 Operating Profit P4,800.00 P4,800.00 Interest Expense P900.00 P800.00 Earnings before tax P3,900.00 P4,000.00 Income Tax P1,560.00 P1,600.00 Net Profit P2,340.00 P2,400.00 How many percent of the sales is the operating expenses in 2021 and 2020? A 8.82% and 8.33% 70.59% and 72.92% 29.41% and 27.08% 23.53% and 22.92%
- Use the given statement of comprehensive income below in answering the question. DEF Company, Income Statement 2021 2020 Sales P10,200.00 P9,600.00 Cost of Goods Sold P3,000.00 P2,600.00 Gross Profit P7,200.00 P7,000.00 Operating Expenses P2,400.00 P2,200.00 Operating Profit P4,800.00 P4,800.00 Interest Expense P900.00 P800.00 Earnings before tax P3,900.00 P4,000.00 Income Tax P1,560.00 P1,600.00 Net Profit P2,340.00 P2,400.00 What is the percent change of net profit? А -3.5% В 12.5% C) -12.5% -2.5%Concord, Inc. has the following Income Statement (in millions): CONCORD, INC. Income Statement For the Year Ended December 31, 2026 Net Sales $145 Cost of Goods Sold 87 Gross Profit Operating Expenses Net Income 58 O 66.7% 40.0% 100.0% 60.0% 39 $19 Using vertical analysis, what percentage is assigned to gross profit?Given the income statement below, Mega Trade Inc. wants to find the resulting net income for the year 2018 (in million). What is the right amount? Income Statement ($ Million) YEAR END YEAR END YEAR END YEAR END 2015 2016 2017 2018 Sales 1,234.90 1,251.70 1,300.40 1,334.40 Cost Sales -679.1 -659 -681.3 -667 Gross Operating Income Selling & Administration -339.7 -348.6 -351.2 -373.3 Depreciation -47.5 -52 -55.9 -75.2 Other Income/Expenses 11.8 7.6 7 8.2 Earnings Before Interest and Taxes Interest Income 1.3 1.4 1.7 2 Interest Expense -16.2 -15.1 -20.5 -23.7 Pre Tax Income Income Taxes -56.8 -64.2 -67.5 -72.6 Net Income Dividends -38.3 -38.7 -39.8 -40.1 Addition to Retained Earnings
- Comparative Income Statements Consider the following income statement data from the Mono Company: Sales revenue Cost of goods sold Selling expenses Administrative expenses Income tax expense 2019 2018 $600,000 $450,000 336,000 279,000 105,000 99,000 60,000 50,000 4,000 3,000 Prepare a contparative income statement, showing increases, and decreases in dollars and in percentages. Note: Round "Percent Change" answers to one decimal place (ex: 0.2345 = 23.5%). Sales Revenue Cost of Goods Sold MONO COMPANY Comparative Income Statements ♦ Selling Expenses Administrative Expenses Total Income before Income Taxes ◆ → $ $ 2019 0 $ 0 0 0 0 oooo 0 0 $ 2018 Increase (Decrease) 0 $ 0 0 0 0 0 0 0 0 $ 0 0 0 0 0 0 0 0 0 Percent Change 0% 0% 0% 0% 0% 0% 0% 0% 0 %Manero Company included the following information in its annual report: 2018 2017 Sales Cost of goods sold Operating expenses Net income $188,400 115,000 50,000 23,400 $162,500 102,500 50,000 10,000 2016 $150,500 100,000 45,000 5,500 In a common size income statement for 2017, the cost of goods sold are expressed as OA. 115.0% OB. 61.0% OC. 100.0% O D. 63.7%A comparative income statement is given below for Rainbow Company Rainbow Company Comparative Income Statement For the Years Ended June 30, 2019, and 2018 2019 2018 Sales P 5,000,000.00 P 4,000,000.00 Less: Cost of Goods Sold 3,160,000.00 2,400,000.00 Gross Margin 1,840,000.00 P 1,600,000.00 Selling Expenses 900,000.00 700,000.00 Administrative Expenses 680,000.00 584,000.00 Total Expenses 1,580,000.00 1,284,000.00 Net Operating Income 260,000.00 P 316,000.00 Interest Expense 70,000.00 40,000.00 Net Income Before Taxes P 190,000.00 P 276,000.00 The president is concerned that net income is down in 2019 even though sales have increased during the year. The president is also concerned that administrative expenses have increased, since the company made a concerted effort during 2019 to pare "fat" out of the organization. Required: 1. Express each year's income statement in common-size percentages. Carry computations to one decimal place. 2. Comment briefly on the changes between the two…
