Corporate Financial Accounting - W/CENGAGENOW
13th Edition
ISBN: 9781285148717
Author: WARREN
Publisher: CENGAGE C
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Textbook Question
Chapter 2, Problem 2.3MAD
Analyze Vera Bradley. Inc.
Vera Bradley, Inc. (VRA) is a leading designer, producer, and retailer of fashion handbags, accessories, and travel items for women. Income statements for two recent years for Vera Bradley are as follows:
| Vera Bradley, Inc Income Statements For the Years Ended January 31 (in millions) |
||
| Year 2 | Year 1 | |
| Revenue | $502.6 | $509.0 |
| Expenses: Cost of merchandise sold |
$(221.4) | $(240.0) |
| Selling, general, admin, expenses | (236.8) | (208.7) |
| Other expenses | (16.8) | (21.9) |
| Total expenses | $(475.0) | $(470.6) |
| Operating income | $ 27.6 | $ 38.4 |
a. Prepare a horizontal analysis of the two income statements.
b. 
Assume you are a stockholder of Vera Bradley. Would you be inclined to view Vera Bradley’s change in operating income favorably or unfavorably?
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Chapter 2 Solutions
Corporate Financial Accounting - W/CENGAGENOW
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