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The comparative condensed income statements of Emley Corporation are shown below EMLEY CORPORATION Comparative Condensed Income Statements For the Years Ended December 31 Net sales Cost of goods sold Gross profit Operating expenses Net income 2017 $679,800 497,490 182,310 128,750 $ 53,560 2016 $617,000 432,600 184,400 123,600 $60,800 Prepare a horizontal analysis of the income statement data for Emley Corporation using 2016 as a base. (Enter negative amounts and percentages using either a negative sign preceding the number e.g.-45,-4596 or parentheses e.g. (45), (45%). Round percentages to 1 decimal place, e.g. 12.396.) EMLEY CORPORATION Increase or (Decrease) During 2017 2017 2016 Amount Percenta Net sales $679,800 $617,000 Cost of goods sold 497,490 432,600 182,310 184,400 Operating expenses 128,750 123,600 $53,560 $60,800 Gross proft 1% Net income 1% Prepare a vertical analysis of the income statement data for Emley Corporation in columnar form for both years. (Round percentages to 1 decimal place, e.g 12.3%.) EMLEY CORPORATION 2017 2016 Percent Amount % $617,000 % 432,600 184,400 % 123,600 % $60,800 Percent Amount $679,800 Cost of goods sold 497,490 182,310 Operating expenses 128,750 53,560 Net sales Gross proft Net income

Explanation / Answer

Horizontal analysis:- EMLEY Corporation Condensed Income Statements For the Years Ended December 31 Increase or (Decrease) During 2016 Particulars            2,017        2,016 Amount Percentage Net sales        679,800    617,000                           62,800 10.2% Cost of goods sold        497,490    432,600                           64,890 15.0% Gross Profit        182,310    184,400                            (2,090) (1.1%) Operating expenses          128,750    123,600                             5,150 4.2% Net Income          53,560      60,800                            (7,240) (11.9%) Vertical analysis:- EMLEY Corporation Condensed Income Statements For the Years Ended December 31 Particulars 2017 2016 Amount Percent Amount Percent Net sales        679,800 100.0%                         617,000 100.0% Cost of goods sold        497,490 73.2%                         432,600 70.1% Gross Profit        182,310 26.8%                         184,400 29.9% Operating expenses          128,750 18.9%                         123,600 20.0% Net Income          53,560 7.9%                           60,800 9.9%

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