Exercise 13-4 Operating data for Riverbed Corp are presented below. 2017 2016 Pr

Question

Exercise 13-4

Operating data for Riverbed Corp are presented below.

2017

2016

Prepare a schedule showing a vertical analysis for 2017 and 2016. (Round percentages to 1 decimal place, e.g. 12.1%.)

2017

2016

Amount

Percent

Amount

Percent

Sales

$850,500

%

$643,000

%

Cost of goods sold

529,000

%

409,600

%

Gross profit

321,500

%

233,400

%

Selling expenses

121,800

%

75,900

%

Administrative expenses

73,300

%

50,700

%

Total operating expenses

195,100

%

126,600

%

Income before income taxes

126,400

%

106,800

%

Income tax expense

33,000

%

23,500

%

Net income

$ 93,400

%

$ 83,300

%

2017

2016

Sales revenue $850,500 $643,000 Cost of goods sold 529,000 409,600 Selling expenses 121,800 75,900 Administrative expenses 73,300 50,700 Income tax expense 33,000 23,500 Net income 93,400 83,300

Explanation / Answer

RIVERBED CORP Condensed Income Statement Years Ended December 31 2017 2016 Amount Percent Amount Percent Sales $850,500 100.0% $643,000 100.0% Cost of goods sold 529,000 62.2% 409,600 63.7% Gross profit 321,500 37.8% 233,400 36.3% Selling expenses 121,800 14.3% 75,900 11.8% Administrative expenses 73,300 8.6% 50,700 7.9% Total operating expenses 195,100 22.9% 126,600 19.7% Income before income taxes 126,400 14.9% 106,800 16.6% Income tax expense 33,000 3.9% 23,500 3.7% Net income $93,400 11.0% $83,300 13.0%

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