The income statement of Small Town, Inc. is as shown below: Small Town, Inc. Comparative Income Statement Year Ended December 31, 2025 (In millions) Net Sales Cost of Goods Sold Gross Profit Operating Expenses: Selling Expenses Administrative Expenses Total Operating Expenses Operating Income Other Income and (Expenses): Interest Expense Total Other Income and (Expenses) Income Before Income Taxes Income Tax Expense Net Income $7,800 4,300 3,500 600 400 1,000 2,500 (400) (400) 2,100 1,000 $1,100 Performing a vertical analysis, what is the percentage of Cost of Goods Sold to Net Sales? 55.13% 14.10% 44.87% 26.92%
The income statement of Small Town, Inc. is as shown below: Small Town, Inc. Comparative Income Statement Year Ended December 31, 2025 (In millions) Net Sales Cost of Goods Sold Gross Profit Operating Expenses: Selling Expenses Administrative Expenses Total Operating Expenses Operating Income Other Income and (Expenses): Interest Expense Total Other Income and (Expenses) Income Before Income Taxes Income Tax Expense Net Income $7,800 4,300 3,500 600 400 1,000 2,500 (400) (400) 2,100 1,000 $1,100 Performing a vertical analysis, what is the percentage of Cost of Goods Sold to Net Sales? 55.13% 14.10% 44.87% 26.92%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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36. Help me selecting the right answer. Thank you
Transcribed Image Text:The income statement of Small Town, Inc. is as shown below:
Small Town, Inc.
Comparative Income Statement
Year Ended December 31, 2025
(In millions)
Net Sales
Cost of Goods Sold
Gross Profit
Operating Expenses:
Selling Expenses
Administrative Expenses
Total Operating Expenses
Operating Income
Other Income and (Expenses):
Interest Expense
Total Other Income and
(Expenses)
Income Before Income Taxes
Income Tax Expense
Net Income
$7,800
4,300
3,500
600
400
1,000
2,500
(400)
(400)
2,100
1,000
$1,100
Performing a vertical analysis, what is the percentage of Cost of Goods Sold to Net Sales?
55.13%
14.10%
44.87%
26.92%
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