Common-Sized Income StatementRevenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry averages areexpressed in percentages.ElectronicsTannenhillIndustryCompanyAverageSales$820,000100 %Cost of goods sold524,80070Gross profit$295,20030 %Selling expenses$180,40017 %Administrative expenses65,6007Total operating expenses$246,00024 %Operating income$49,2006 %Other revenue16,4002$65,6008 %Other expense8,2001Income before income tax$57,4007 %Income tax expense24,6004Net income$32,8003 % a. Prepare a common-sized income statement comparing the results of operations for Tannenhill Company with the industry average. If required, round percentages to one decimal place. Enter all amounts aspositive numbers.Tannenhill CompanyCommon-Sized Income StatementFor the Year Ended December 31Tannenhill Tannenhill ElectronicsCompanyCompanyIndustryAmountPercentAverageSales$820,000100.0%Cost of goods sold524,800%70%Gross profit$295,20030%Selling expenses$180,400%17%Administrative expenses65,6007%Total operating expenses$246,00024%Income from operations$49,200%6%Other revenue16,400%2%$65,600%8%Other expense8,200%1%Income before income tax$57,400%7%Income tax expense24,600%4%Net income$32,800%3%b. The company is managing the cost of manufacturing productthan the industry, and has slightlyselling and administrative expenses relative to the industry. Thecombined impact causes net income as a percent of sales to bethan the industry average.

Income statement is a statement which records the revenue and expenses of an undertaking for a…

Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry average expressed in percentages. Electronics Tannenhill Industry Company Average Sales $820,000 100 % Cost of goods sold 524,800 70 Gross profit $295,200 30 % Selling expenses $180,400 17 % Administrative expenses 65,600 Total operating expenses $246,000 24 % Operating income $49,200 6 % Other revenue 16,400 2 $65,600 8 % Other expense 8,200 Income before income tax $57,400 7 % Income tax expense 24,600 4 Dlot inco $32 800

Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry average expressed in percentages. Electronics Tannenhill Industry Company Average Sales $820,000 100 % Cost of goods sold 524,800 70 Gross profit $295,200 30 % Selling expenses $180,400 17 % Administrative expenses 65,600 Total operating expenses $246,000 24 % Operating income $49,200 6 % Other revenue 16,400 2 $65,600 8 % Other expense 8,200 Income before income tax $57,400 7 % Income tax expense 24,600 4 Dlot inco $32 800

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 3E

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