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Income statement data for Winthrop Company for two recent years ended December 31 are as follows: Previous Year Current Year Sales $412,500 $330,000 Cost of merchandise sold 356,700 290,000 Gross profit $55,800 $40,000 Selling expenses $16,100 $14,000 Administrative expenses 14,760 12,000 Total operating expenses $30,860 $26,000 Income before income tax expense $24,940 $14,000 Income tax expenses 10,0০০ 5,600 Net income $14,940 $8,400 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 to one decimal place. Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent Sales $412,500 $330,000 s Cost of merchandise sold 356,700 290.000 Gross profit $55,800 $40,000 Selling expenses $16,100 $14,000 s Administrative expenses 14,760 12,000 Total operating expenses $30.860 $26.000 Income before income tax expense $24,940 $14,000 Income tax expense 10,000 5,600 Net income $14,940 $8,400 S

Income statement data for Winthrop Company for two recent years ended December 31 are as follows: Previous Year Current Year Sales $412,500 $330,000 Cost of merchandise sold 356,700 290,000 Gross profit $55,800 $40,000 Selling expenses $16,100 $14,000 Administrative expenses 14,760 12,000 Total operating expenses $30,860 $26,000 Income before income tax expense $24,940 $14,000 Income tax expenses 10,0০০ 5,600 Net income $14,940 $8,400 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 to one decimal place. Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent Sales $412,500 $330,000 s Cost of merchandise sold 356,700 290.000 Gross profit $55,800 $40,000 Selling expenses $16,100 $14,000 s Administrative expenses 14,760 12,000 Total operating expenses $30.860 $26.000 Income before income tax expense $24,940 $14,000 Income tax expense 10,000 5,600 Net income $14,940 $8,400 S

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 38E: Sundahl Companys income statements for the past 2 years are as follows: Refer to the information for...
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Horizontal Analysis of the Income Statement Income statement data for Wwinthrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales $412,500 $330,000 Cost of merchandise sold 356,700 290,000 Gross profit $55,800 $40,000 Selling expenses $16,100 $14,000 Administrative expenses 14,760 12,000 Total operating expenses $30,860 $26,000 Income before income tax expense $24,940 $14,000 Income tax expenses 10,000 5,600 Net income $14,940 $8,400 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 to one decimal place. Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent Sales $412,500 $330,000 $ Cost of merchandise sold 356,700 290,000 % Gross profit $55,800 $40,000 % Selling expenses $16,100 $14,000 $ % Administrative expenses 14,760 12,000 Total operating expenses $30,860 $26,000 s Income before income tax expense $24,940 $14,000 $ % Income tax expense 10,000 5,600 Net income $14,940 $8,400 $ %
Transcribed Image Text:Horizontal Analysis of the Income Statement Income statement data for Wwinthrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales $412,500 $330,000 Cost of merchandise sold 356,700 290,000 Gross profit $55,800 $40,000 Selling expenses $16,100 $14,000 Administrative expenses 14,760 12,000 Total operating expenses $30,860 $26,000 Income before income tax expense $24,940 $14,000 Income tax expenses 10,000 5,600 Net income $14,940 $8,400 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 to one decimal place. Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent Sales $412,500 $330,000 $ Cost of merchandise sold 356,700 290,000 % Gross profit $55,800 $40,000 % Selling expenses $16,100 $14,000 $ % Administrative expenses 14,760 12,000 Total operating expenses $30,860 $26,000 s Income before income tax expense $24,940 $14,000 $ % Income tax expense 10,000 5,600 Net income $14,940 $8,400 $ %
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