Homework Help is Here – Start Your Trial Now!
Business
Accounting
Income statements for Gibson Company for Year 3 and Year 4 follow: GIBSON COMPANY Income Statements Year 4 Year 3 $200,600 143,600 Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses $180,600 121,600 19,500 14,500 5,800 $161,400 19,200 3,500 $ 15,700 21,500 12,500 3,800 $181,400 19,200 5,000 $ 14,200 Income before taxes Income taxes expense Net income Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.

Income statements for Gibson Company for Year 3 and Year 4 follow: GIBSON COMPANY Income Statements Year 4 Year 3 $200,600 143,600 Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses $180,600 121,600 19,500 14,500 5,800 $161,400 19,200 3,500 $ 15,700 21,500 12,500 3,800 $181,400 19,200 5,000 $ 14,200 Income before taxes Income taxes expense Net income Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.

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 40E: Cuneo Companys income statements for the last 3 years are as follows: Refer to the information for...
See similar textbooks
icon
Related questions
Question

Practice Help

Income statements for Gibson Company for Year 3 and Year 4 follow: GIBSON COMPANY Income Statements Year 4 Year 3 $200,600 143,600 Sales $180,600 Cost of goods sold Selling expenses Administrative expenses Interest expense 21,500 12,500 3,800 $181,400 19,200 121,600 19,500 14,500 5,800 $161,400 Total expenses Income before taxes 19,200 3,500 Income taxes expense 5,000 Net income $ 14,200 $ 15,700 Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
Transcribed Image Text:Income statements for Gibson Company for Year 3 and Year 4 follow: GIBSON COMPANY Income Statements Year 4 Year 3 $200,600 143,600 Sales $180,600 Cost of goods sold Selling expenses Administrative expenses Interest expense 21,500 12,500 3,800 $181,400 19,200 121,600 19,500 14,500 5,800 $161,400 Total expenses Income before taxes 19,200 3,500 Income taxes expense 5,000 Net income $ 14,200 $ 15,700 Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
Required A Required B Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. (Negative answers should be indicated by a minus sign. Round your answers to 1 decimal place. (i.e., .234 should be entered as 23.4).) GIBSON COMPANY Horizontal Analysis of Income Statements Percentage Change over Year 3 Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income (loss)
Transcribed Image Text:Required A Required B Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. (Negative answers should be indicated by a minus sign. Round your answers to 1 decimal place. (i.e., .234 should be entered as 23.4).) GIBSON COMPANY Horizontal Analysis of Income Statements Percentage Change over Year 3 Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income (loss)
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 2 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Financial Planning
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
College Accounting, Chapters 1-27 (New in Account…
College Accounting, Chapters 1-27 (New in Account…
Accounting
ISBN:
9781305666160
Author:
James A. Heintz, Robert W. Parry
Publisher:
Cengage Learning
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS