The following comparative income statement (in thousands of dollars) for the two

Question

The following comparative income statement (in thousands of dollars) for the two recent fiscal years was adapted from the annual report of Speedway Motorsports, Inc., owner and operator of several major motor speedways, such as the Atlanta, Texas, and Las Vegas Motor Speedways. Current Year Previous Year 2 Revenues: 3 Admissions 4Event-related revenue $104,312.00 $116,644.00 131,164.00 170,368.00 65,824.00 $472,000.00 $484,000.00 42,544.00 180,304.00 44,840.00 NASCAR broadcasting revenue Other operating revenue 7 Total revenue 8 Expenses and other: 9 Direct expense of events 10 NASCAR purse and sanction fees 91,568.00 $101,640.00 117,612.00 20,328.00 220,220.00 424800.00 $459,800.00 $24,200.00 118,000.00 19,352.00 195,880.00 11 Other direct expenses 2 General and administrative 13 Total expenses and other Income from continuing operations $47,200.00 14 Required A. Prepare a comparative income statement for these two years in vertical form, stating each item as a percent of revenues. Enter all amounts as positive numbers. Rounding instructions

Explanation / Answer

VERTICAL ANALYSIS OF INCOME STATEMENT Particulars Current Year Amount Current Year Percentage Previous Year Amount Previous Year Percentage Admissions $ 1,04,312.00 22.10% $ 1,16,644.00 24.10% Event Related revenue $ 1,42,544.00 30.20% $ 1,31,164.00 27.10% NASCAR Broadcasting Revenue $ 1,80,304.00 38.20% $ 1,70,368.00 35.20% Other Operating Income $     44,840.00 9.50% $     65,824.00 13.60% Total Revenue $ 4,72,000.00 100.00% $ 4,84,000.00 100.00% Expenses and others Direct expenses of events $     91,568.00 19.40% $ 1,01,640.00 21.00% NASCAR purse and sanction fees $ 1,18,000.00 25.00% $ 1,17,612.00 24.30% Other direct expenses $     19,352.00 4.10% $     20,328.00 4.20% General and adminstrative $ 1,95,880.00 41.50% $ 2,20,220.00 45.50% Total Expenses and others $ 4,24,800.00 90.00% $ 4,59,800.00 95.00% Income from continuing operation $     47,200.00 10.00% $     24,200.00 5.00%

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