The income statements for Galaxy Tennis for the years ending December 31, 2021 and 2020, are provided below. GALAXY TENNISIncome StatementsFor the years ended December 31 Increase (Decrease) 2021 2020 Amount % Net sales Cost of goods sold Gross profit Operating expenses Operating income Other income (expense) Income before tax Income tax expense Net income $ 6,150,000 2,850,000 3,300,000 1,510,000 1,790,000 60,000 1,850,000 390,000 $ 1,460,000 $ 6,250,000 2,920,000 3,330,000 1,390,000 1,940,000 85,000 2,025,000 435,000 $ 1,590,000 Required:1. Complete the “Amount” and “%” columns to be used in a horizontal analysis of Galaxy Tennis income statement.2. Discuss the major fluctuations in income statement items during the year.
The income statements for Galaxy Tennis for the years ending December 31, 2021 and 2020, are provided below. GALAXY TENNISIncome StatementsFor the years ended December 31 Increase (Decrease) 2021 2020 Amount % Net sales Cost of goods sold Gross profit Operating expenses Operating income Other income (expense) Income before tax Income tax expense Net income $ 6,150,000 2,850,000 3,300,000 1,510,000 1,790,000 60,000 1,850,000 390,000 $ 1,460,000 $ 6,250,000 2,920,000 3,330,000 1,390,000 1,940,000 85,000 2,025,000 435,000 $ 1,590,000 Required:1. Complete the “Amount” and “%” columns to be used in a horizontal analysis of Galaxy Tennis income statement.2. Discuss the major fluctuations in income statement items during the year.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The income statements for Galaxy Tennis for the years ending December 31, 2021 and 2020, are provided below.
| GALAXY TENNIS Income Statements For the years ended December 31 |
||||
| Increase (Decrease) | ||||
| 2021 | 2020 | Amount | % | |
|
Net sales Cost of goods sold Gross profit Operating expenses Operating income Other income (expense) Income before tax Income tax expense Net income |
$ 6,150,000 2,850,000 3,300,000 1,510,000 1,790,000 60,000 1,850,000 390,000 $ 1,460,000 |
$ 6,250,000 2,920,000 3,330,000 1,390,000 1,940,000 85,000 2,025,000 435,000 $ 1,590,000 |
Required:
1. Complete the “Amount” and “%” columns to be used in a horizontal analysis of Galaxy Tennis income statement.
2. Discuss the major fluctuations in income statement items during the year.
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