A) Create a VERTICAL ANALYIS for this income statement Income Statement 2014 201

Question

A) Create a VERTICAL ANALYIS for this income statement

Income Statement 2014 2013 Sales 37,580,000.00 34,374,000.00 Cost of Sales 34,895,000.00 32,016,000.00 Gross Profit     2,685,000.00     2,385,000.00 Selling, General and Administrative Expenses     1,255,000.00        983,000.00 Operating Income (loss)     1,430,000.00     1,375,000.00 Interest and Other        178,000.00        118,000.00 Income (loss) from continuing operations before income taxes     1,252,000.00     1,257,000.00 Income Tax Expense (benefit)        396,000.00        409,000.00 Income (loss) from continuing operations        856,000.00        848,000.00 Income (loss) from discontinued operations, net            8,000.00        (70,000.00) Net Income (loss)        864,000.00        778,000.00

Explanation / Answer

Common Size analysis For the years 2014 and 2013 2014 2013 Amount % Amount % Sales 37580000 100.0% 34374000 100.0% Cost of Sales 34895000 92.9% 32016000 93.1% Gross Profit 2685000 7.1% 2358000 6.9% Selling, General and Administrative Expenses 1255000 3.3% 983000 2.9% Operating Income (loss) 1430000 3.8% 1375000 4.0% Interest and Other 178000 0.5% 118000 0.3% Income (loss) from continuing operations before income taxes 1252000 3.3% 1257000 3.7% Income Tax Expense (benefit) 396000 1.1% 409000 1.2% Income (loss) from continuing operations 856000 2.3% 848000 2.5% Income (loss) from discontinued operations, net 8000 0.0% -70000 -0.2% Net Income (loss) 864000 2.3% 778000 2.3%

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