Using the following income statements, perform the calculations needed for verti

Question

Using the following income statements, perform the calculations needed for vertical analyses. (Round percentage values to 1 decimal place.)

net sales

Sorry Net Income = 24,640 ___% Previous $23,275_____%

Thank you!

net sales

150,000 __% 105,000 __% cost of goods sold 78,000 __% 60,000 __% gross profit 72,000 __% 45,000 __% selling, general 12,000 __% 6,500 __% income from operation 60,000 __% 38,500 __% interest expense 4,000 __% 5,250 __% income before income income tax 56,000 __% 33,250 __% income tax expense 16,800 __% 9,975 __% net income 24,640

Explanation / Answer

Please check Net income given by you of 24,640 because when we deduct income before tax - income tax expense i.e. 56000-16800 we get 39200

Net sales 150000 100% 105000 100% Cost of goods sold 78000 52% 60000 57.1429% Gross profit 72000 48% 45000 42.8571% Selling, general 12000 8% 6500 6.1905% Income from operation 60000 40% 38500 36.6666% Interest expense 4000 2.67% 5250 5% Income before income tax 56000 37.33% 33250 31.6666% Income tax expense 16800 11.20% 9975 9.5% Net income 24640 16.4267% 23275 22.1666% Net income when we deduct income before tax - income tax expense 39200 26.13% 23275 22.1666%

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