Chapter 15 1. The following items were taken from the financial statements of Sm

Question

Chapter 15 1. The following items were taken from the financial statements of Smithton, Inc., over a three-year period: ltem 2014 $355,000 $340,000 $300,000 2015 2013 Net Sales Cost of Goods Sold 214000186,000 Gross Profit $141000 $138 000 114.000 Instructions Compute the following for each of the above time periods. a. The amount and percentage change from 2013 to 2014. b. The amount and percentage change from 2014 to 2015 (Check Figures: a. $40,000 and 13.3% net sales, 16,000 and 8.5% CGS, 24,000 and 21.1% gross profit b. 15,000 and 4.4% net sales, 12,000 and 5.9% CGS. 3,000 and 2.2% gross profit)

Explanation / Answer

1) Amount and percentage change from 2013 to 2014 Particulars 2013(a) 2014(b) Difference(b-a) Percentage change(calculation) Percentage change(Amount) Net sales 300000 340000 40000 40000/300000*100 13.3% Cost of goods sold 186000 202000 16000 16000/186000*100 8.5% Gross Profit 114000 138000 24000 24000/114000*100 21.1% 2) Amount and percentage change from 2014 to 2015 Particulars 2014(a) 2015(b) Difference(b-a) Percentage change(calculation) Percentage change(Amount) Net sales 340000 355000 15000 15000/340000*100 4.4% Cost of goods sold 202000 214000 12000 12000/202000*100 5.9% Gross Profit 138000 141000 3000 3000/138000*100 2.2%

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