a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round your answers to one decimal place. Winthrop Company Comparative Income Statement For the Years Ended December 31 Line Item Description Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Income before income tax expense Income tax expense Net income Current Year Amount $2,240,000 $2,000,000 (1,925,000) (1,750,000) $315,000 $250,000 $(152,500) $(125,000) (118,000) (100,000) $(270,500) $(225,000) $44,500 $25,000 (17,800) (10,000) $26,700 $15,000 Previous Increase Increase Year (Decrease) (Decrease) Amount Amount Percent % % % % % % % % %
a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round your answers to one decimal place. Winthrop Company Comparative Income Statement For the Years Ended December 31 Line Item Description Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Income before income tax expense Income tax expense Net income Current Year Amount $2,240,000 $2,000,000 (1,925,000) (1,750,000) $315,000 $250,000 $(152,500) $(125,000) (118,000) (100,000) $(270,500) $(225,000) $44,500 $25,000 (17,800) (10,000) $26,700 $15,000 Previous Increase Increase Year (Decrease) (Decrease) Amount Amount Percent % % % % % % % % %
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter16: Financial Statement Analysis
Section: Chapter Questions
Problem 5E
Related questions
Question
![Horizontal analysis of the income statement
Income statement data for Winthrop Company for two recent years ended December 31 are as follows:
Current Year
Previous Year
Sales
Cost of goods sold
Gross profit
Selling expenses
Administrative expenses
Total operating expenses
Income before income tax expense
Income tax expense
Net income
$2,240,000
(1,925,000)
$315,000
$(152,500)
(118,000)
$(270,500)
$44,500
(17,800)
$26,700
$2,000,000
(1,750,000)
$250,000
$(125,000)
(100,000)
$(225,000)
$25,000
(10,000)
$15,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F067ce7d2-f100-4f1a-b495-b300a7f314eb%2Fc8a47ad4-af6b-4e41-8296-7ffec9d83f8a%2Ftixhhy8_processed.png&w=3840&q=75)
Transcribed Image Text:Horizontal analysis of the income statement
Income statement data for Winthrop Company for two recent years ended December 31 are as follows:
Current Year
Previous Year
Sales
Cost of goods sold
Gross profit
Selling expenses
Administrative expenses
Total operating expenses
Income before income tax expense
Income tax expense
Net income
$2,240,000
(1,925,000)
$315,000
$(152,500)
(118,000)
$(270,500)
$44,500
(17,800)
$26,700
$2,000,000
(1,750,000)
$250,000
$(125,000)
(100,000)
$(225,000)
$25,000
(10,000)
$15,000
![a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round your answers to one decimal place.
Winthrop Company
Comparative Income Statement
For the Years Ended December 31
Current Previous
Year
Year
Amount Amount
$2,240,000 $2,000,000 $
(1,925,000) (1,750,000)
$315,000
$250,000
Line Item Description
Sales
Cost of goods sold
Gross profit
Selling expenses
Administrative expenses
Total operating expenses
Income before income tax expense
Income tax expense
Net income
Increase
Increase
(Decrease) (Decrease)
Amount
Percent
$(152,500)
$(125,000)
(118,000) (100,000)
$(270,500) $(225,000)
$44,500
$25,000
(17,800)
(10,000)
$26,700
$15,000 $
%
%
%
%
%
%
%
%
%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F067ce7d2-f100-4f1a-b495-b300a7f314eb%2Fc8a47ad4-af6b-4e41-8296-7ffec9d83f8a%2Fsbnfepg_processed.jpeg&w=3840&q=75)
Transcribed Image Text:a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round your answers to one decimal place.
Winthrop Company
Comparative Income Statement
For the Years Ended December 31
Current Previous
Year
Year
Amount Amount
$2,240,000 $2,000,000 $
(1,925,000) (1,750,000)
$315,000
$250,000
Line Item Description
Sales
Cost of goods sold
Gross profit
Selling expenses
Administrative expenses
Total operating expenses
Income before income tax expense
Income tax expense
Net income
Increase
Increase
(Decrease) (Decrease)
Amount
Percent
$(152,500)
$(125,000)
(118,000) (100,000)
$(270,500) $(225,000)
$44,500
$25,000
(17,800)
(10,000)
$26,700
$15,000 $
%
%
%
%
%
%
%
%
%
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