Prepare common size income statement for price company, a sole proprietorship, for the two years shown as above by converting the dollar amounts into percentage. For each year, sales will appear as 100 percent and other items will be expressed as a percentage of sale. ( income race are not involved as the business is not incorporated). Exercise 14.3 (Algo) Common Size Income Statements (LO14-1)Year 2Year 1$ 483,000330,000$ 153,000130,000$ 23,000SalesCost of goods soldGross profitOperating expenses$ 420,000268,000$ 152,000116,00036,000Net incomea. Prepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by convertingthe dollar amounts into percentages. For each year, sales will appear as 100 percent and other items will be expressed as apercentage of sales. (Income taxes are not involved as the business is not incorporated.)b. State whether the changes from year 1 to year 2 are favorable or unfavorable.Complete this question by entering your answers in the tabs below.Required ARequired BPrepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by

The common size statement expresses each item in the percentage form. It helps to compare the…

Answered: Exercise 14.3 (Algo) Common Size Income…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.2.2P

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Prepare common size income statement for price company, a sole proprietorship, for the two years shown as above by converting the dollar amounts into percentage. For each year, sales will appear as 100 percent and other items will be expressed as a percentage of sale. ( income race are not involved as the business is not incorporated).

Exercise 14.3 (Algo) Common Size Income Statements (LO14-1)
Year 2
Year 1
$ 483,000
330,000
$ 153,000
130,000
$ 23,000
Sales
Cost of goods sold
Gross profit
Operating expenses
$ 420,000
268,000
$ 152,000
116,000
36,000
Net income
a. Prepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by converting
the dollar amounts into percentages. For each year, sales will appear as 100 percent and other items will be expressed as a
percentage of sales. (Income taxes are not involved as the business is not incorporated.)
b. State whether the changes from year 1 to year 2 are favorable or unfavorable.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Prepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by

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