Comparative income statements for Pearle Company are provided below: 2 points ea
ID: 2469737 • Letter: C
Question
Comparative income statements for Pearle Company are provided below: 2 points each/14 points
Perform a horizontal analysis of Pearle Company's income statement by computing horizontal percentages for each item. Round your answer to one decimal place (i.e. 22.5%).
2014
2013
%
Sales
595,000
532,200
Less cost of goods sold
386,200
357,650
Gross Margin
208,800
174,550
Less operating expenses
108,950
99,770
Income before taxes
99,850
74,780
Income taxes
39,940
29,912
Net income
59,910
44,868
2014
2013
%
Sales
595,000
532,200
Less cost of goods sold
386,200
357,650
Gross Margin
208,800
174,550
Less operating expenses
108,950
99,770
Income before taxes
99,850
74,780
Income taxes
39,940
29,912
Net income
59,910
44,868
Explanation / Answer
2014 2013 % Sales 595000 532200 11.8% Cost of Goods Sold 386200 357650 8.0% Gross Margin 208800 174550 19.6% Less Operating Expenses 108950 99770 9.2% Income before Tax 99850 74780 33.5% Income Tax 39940 29912 33.5% Net Income 59910 44868 33.5%
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