Question 1 Prepare a horizontal analysis of the following comparative income sta
ID: 2395773 • Letter: Q
Question
Question 1
Prepare a horizontal analysis of the following comparative income statement for Westwind Corporation. Round percentage changes to the nearest one-tenth percent.
Westwind Corporation
Comparative Income Statement
For the Years Ended December 31, 2016 and 2015
2016
2015
Total revenue
$1,400,000
$1,250,000
Expenses:
Cost of goods sold
925,000
$830,000
Operating expenses
313,000
280,000
Interest expense
14,000
12,000
Income tax expense
48,300
38,000
Total expenses
$1,300,300
$1,160,000
Net Income
$99,700
$90,000
Westwind Corporation
Comparative Income Statement
For the Years Ended December 31, 2016 and 2015
2016
2015
Total revenue
$1,400,000
$1,250,000
Expenses:
Cost of goods sold
925,000
$830,000
Operating expenses
313,000
280,000
Interest expense
14,000
12,000
Income tax expense
48,300
38,000
Total expenses
$1,300,300
$1,160,000
Net Income
$99,700
$90,000
Explanation / Answer
Compartive income statement Increase(decrease) for the years ended december 31,2016 and 2015 Amount percentage 2016 2015 total revenue 1,400,000 1,250,000 150,000 12.0% Expenses: cost of goods sold 925,000 830,000 95,000 11.4% operating expenses 313,000 280,000 33,000 11.8% interest expense 14,000 12,000 2,000 16.7% income tax expense 48,300 38,000 10,300 27.1% total expenses 1,300,300 1,160,000 140,300 12.1% Net income 99,700 90,000 9,700 10.8%
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