Operating data for Riverbed Corp are presented below 2017 2016 Sales revenue Cos

Question

Operating data for Riverbed Corp are presented below 2017 2016 Sales revenue Cost of goods sold Selling expenses Administrative expenses Income tax expense Net income $850,500 529,000 121,800 73,300 33,000 93,400 $643,000 409,600 75,900 50,700 23,500 83,300 Prepare a schedule showing a vertical analysis for 2017 and 2016, (Round percentages to 1 decimal place, eg. 12.1%.) RIVERBED CORP 2017 2016 Percent Amount Percent Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Amount $850,500 529,000 321,500 121,800 73,300 195,100 126,400 33,000 93,400 % $643,000 % 409,600 % 233,400 75,900 50,700 90 126,600 90 106,800 23,500 % $83,300 come before income taxes Income tax expense Net income

Explanation / Answer

Prepare vertical analysis :

2017 2016 Amount Percent Amount Percent Sales 850500 100% 643000 100% Cost of goods sold 529000 62.2% 409600 63.7% Gross profit 321500 37.8% 233400 36.3% Selling expenses 121800 14.3% 75900 11.8% Administrative expense 73300 8.6% 50700 7.9% Total operating expense 195100 22.9% 126600 19.7% Income before income taxes 126400 14.9% 106800 16.6% Income tax expense 33000 3.9% 23500 3.7% Net income 93400 11.0% 83300 13.0%

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