(a) Horizontal analysis of income statement: In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base. The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

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Answer 1

Question

Chapter 2, Problem 2.3ADM

To determine

(a)

Horizontal analysis of income statement:

In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base.

The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

(b)

To determine

To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

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Subject: Financial Accounting A manufacturing company failed to make a year-end accrual of $280,000 for environmental penalties. Its tax rate is 35%. As a result of this error, net income was: (a) Unaffected (b) Overstated by $182,000 (c) Overstated by $98,000 (d) Overstated by $280,000

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Please explain the solution to this general accounting problem with accurate principles.

Answer 2

Question

Chapter 2, Problem 2.3ADM

To determine

(a)

Horizontal analysis of income statement:

In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base.

The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

(b)

To determine

To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

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Answer 3

Question

Chapter 2, Problem 2.3ADM

To determine

(a)

Horizontal analysis of income statement:

In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base.

The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

(b)

To determine

To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

Expert Solution & Answer

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Answer 4

Question

Chapter 2, Problem 2.3ADM

To determine

(a)

Horizontal analysis of income statement:

In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base.

The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

(b)

To determine

To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

Expert Solution & Answer

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Answer 5

Chapter 2, Problem 2.3ADM

To determine

(a)

Horizontal analysis of income statement:

In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base.

The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

(b)

To determine

To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

Answer 6

Chapter 2, Problem 2.3ADM

To determine

(a)

Horizontal analysis of income statement:

In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base.

The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

Answer 7

Chapter 2, Problem 2.3ADM

To determine

(a)

Horizontal analysis of income statement:

In horizontal analysis of income statement, the amount of each item of the current year financial statement is compared with the previous year financial statement. The amount of each item increased or decreased in the current income statement, and its respective percentage can be computed by taking the earlier statement as the base.

The amount of change in millions, and the percentage of change from the Year 1 to the Year 2.

Answer 8

(b)

To determine

To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

Answer 9

(b)

To determine

To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

Answer 10

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Answer 11

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Answer 12

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Answer 13

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Solution Summary: The author compares the amount of each item in the current year financial statement with the previous year, and determines its percentage by taking the earlier statement as the base.

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To discuss: The conclusions drawn from the analysis of the revenue, and the operating expenses.

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Chapter 2 Solutions