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Using vertical analysis, assess the financial performance of Company A and Company B with comparison.

Using vertical analysis, assess the financial performance of Company A and Company B with comparison.

FINANCIAL ACCOUNTING
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 managerial accountant at Company A, a small retailer, reviews information about Company B, a large national firm. Review the following information listed below about Company A and Company B: Company A Income Statement: Vertical Analysis Company A 100% Sales revenues Less: Cost of goods sold Gross profit Less: Operating expenses Operating income Less: Interest expense Income before income taxes Less: Income tax expense Net income 62.40% 37.60% 18.20% 19.40% 1.98% 17.42% 3.40% 14.02% Company B 100% 71.20% 28.80% 16.10% 12.70% 1.60% 11.10% 2.98% 8.12% Using vertical analysis, assess the financial performance of Company A and Company B with comparison.
Transcribed Image Text:The managerial accountant at Company A, a small retailer, reviews information about Company B, a large national firm. Review the following information listed below about Company A and Company B: Company A Income Statement: Vertical Analysis Company A 100% Sales revenues Less: Cost of goods sold Gross profit Less: Operating expenses Operating income Less: Interest expense Income before income taxes Less: Income tax expense Net income 62.40% 37.60% 18.20% 19.40% 1.98% 17.42% 3.40% 14.02% Company B 100% 71.20% 28.80% 16.10% 12.70% 1.60% 11.10% 2.98% 8.12% Using vertical analysis, assess the financial performance of Company A and Company B with comparison.
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