Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current YearPrevious YearSales$ 2,580,000$3,550,000Cost of goods sold1,578,9601,938,300Selling expenses304,440546,700Administrative expenses397,320440,200Income tax expense134,160198,800 A.Prepare an income statement in comparative form, stating each item for both years as a percent of sales. Round your percentages answers to one decimal place. Enter all amounts as positive numbers.B.Comment on the significant changes disclosed by the comparative income statement.

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Answered: Revenue and expense data for Innovation…

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 1E

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Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows:

	Current Year	Previous Year
Sales	$ 2,580,000	$3,550,000
Cost of goods sold	1,578,960	1,938,300
Selling expenses	304,440	546,700
Administrative expenses	397,320	440,200
Income tax expense	134,160	198,800

A.	Prepare an income statement in comparative form, stating each item for both years as a percent of sales. Round your percentages answers to one decimal place. Enter all amounts as positive numbers.
B.	Comment on the significant changes disclosed by the comparative income statement.

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