Condensed data from the income statement for Munchies Corporation follow: (a) Us

Question

Condensed data from the income statement for Munchies Corporation follow: (a) Using vertical analysis, calculate the percentage of the base amount for each year. (Round answers to 1 decimal place, eg, 15.2%.) MUNCHIES CORPORATION Vertical Analysis of Income Statement 2018 2017 Amount $800,000 547,000 253,000 156,000 97,000 16,000 $81,000 Percent Amount 96 $605,000 % 371,000 % 234,000 % 124,000 % 110,000 18,000 % $92,000 Percent Net sales Cost of goods sold Gross profit Operating expenses Income before income tax Income tax expense Net income

Explanation / Answer

2018 2017 Particulars Amt % Amt % Sales 800000 100.0% 605000 100.0% Less: Cost of Goods Sold 547000 68.4% 371000 61.3% Gross Profit 253000 31.6% 234000 63.1% Less: Operating expenses 156000 19.5% 124000 33.4% Income before income taxes 97000 12.1% 110000 29.6% Less: Income Tax Expense 16000 2.0% 18000 4.9% Net Income 81000 10.1% 92000 24.8%

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