Chapter 14, Problem 14.4E

The comparative condensed income statements of Emley Corporation are shown below.

EMLEY CORPORATION

Comparative Condensed Income Statements

For the Years Ended December 31

	2017	2016
Net sales	$660,000	$600,000
Cost of goods sold	483,000	420,000
Gross profit	177,000	180,000
Operating expenses	125,000	120,000
Net income	$ 52,000	$ 60,000

Instructions

(a) Prepare a horizontal analysis of the income statement data for Emley Corporation using 2016 as a base. (Show the amounts of increase or decrease.)

(b) Prepare a vertical analysis of the income statement data for Emley Corporation in columnar form for both years.