Two income statements for Midnight Enterprises are shown below. Midnight Enterprises Income Statements For the Years Ended December 31 Year 2 Year 1 Fees earned $674,350 $520,600 Operating expenses 472,045 338,390 $202,305 $182,210 Operating income a. Prepare a vertical analysis of Midnight Enterprises' income statements. If required, round percentages to the nearest whole number. Do not enter the Midnight Enterprises Income Statements For the Years Ended December 31 Year 2 Amount Year 2 Percent Year 1 Amount Year 1 Percent Fees earned Operating expenses Operating income b. Does the vertical analysis indicate a favorable or unfavorable trend? Depreciation on equipment for the year is $4,560. (a) Record the journal entry if the company prepares adjustments once a year. (b) Record the journal entry if the company prepares adjustments on a monthly basis.

Two income statements for Midnight Enterprises are shown below. Midnight Enterprises Income Statements For the Years Ended December 31 Year 2 Year 1 Fees earned $674,350 $520,600 Operating expenses 472,045 338,390 $202,305 $182,210 Operating income a. Prepare a vertical analysis of Midnight Enterprises' income statements. If required, round percentages to the nearest whole number. Do not enter the Midnight Enterprises Income Statements For the Years Ended December 31 Year 2 Amount Year 2 Percent Year 1 Amount Year 1 Percent Fees earned Operating expenses Operating income b. Does the vertical analysis indicate a favorable or unfavorable trend? Depreciation on equipment for the year is $4,560. (a) Record the journal entry if the company prepares adjustments once a year. (b) Record the journal entry if the company prepares adjustments on a monthly basis.

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter3: The Adjusting Process

Section: Chapter Questions

Problem 30E

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