Chapter 13, Problem 13.4E

To determine

Vertical Analysis: Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount. Use the following formula to calculate vertical analysis percentage:

Formula:

$\text{Vertical analysis percentage }=\left(\frac{\text{Specific item}}{\text{Base}\text{amount}}\right)\times 100$

This analysis is otherwise called as common-size statement.

To prepare: Vertical analysis of the income statement for Corporation J for 2017 and 2016.

Given info: Income statement for the year 2016 and 2017.