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v2.cengagenow.com/Im/takeAssig takeAssignmentMain.doinvoker= assignments&takeAssignmentSession; Locator= assignment-take&inprogress;= false HOMEWORK 15 Show Me How Calculator Print Item eBook ertical anal of income statement Instructions Income Statement Final Question Instructions Revenue and expense d ata for Gresham Inc. are as follows: Current Year $2,720,000 1,675,520 320,960 424,320 152,320 Previous Year Sales Cost of goods sold Selling expenses Administrative expenses Income tax expense $2,050,000 1,111,100 319,800 262,400 118,900 Required A. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. Round your percentages answers to one decimal place. Enter all amounts as positive numbers. B. Comment on the significant changes disclosed by the comparative income statement. Check My Work Previous Next O Type here to search 255 PM 11/17/2017 21

Explanation / Answer

Gresham Inc Comparitive Income Statement Current year Percentage of sales Previous year Percentage of sales Sales       2,720,000 100%          2,050,000 100% Cost of goods sold       1,675,520 $1,675,520/$2,720,000 = 61.6%          1,111,100 $1,111,100/$2,050,000 = 54.2% Gross profit       1,044,480 $1,044,480/$2,720,000 = 38.4%             938,900 $938,900/$2,050,000 = 45.8% Selling expense           320,960 $320,960/$2,720,000 = 11.8%             319,800 $319,800/$2,050,000 = 15.6% Administrative expense           424,320 $424,320/$2,720,000 = 15.6%             262,400 $262,400/$2,050,000 = 12.8% Total operating expenses           745,280 $745,280/$2,720,000 = 27.4%             582,200 $582,200/$2,050,000 = 28.4% Income from operations           299,200 $299,200/$2,720,000 = 11.0%             356,700 $356,700/$2,050,000 = 17.4% Income tax expense           152,320 $152,320/$2,720,000 = 5.6%             118,900 $118,900/$2,050,000 = 5.8% Net income           146,880 $146,880/$2,720,000 = 5.4%             237,800 $237,800/$2,050,000 = 11.6%

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