Answered: Vertical Analysis 2020 2019 2018…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.1E

See similar textbooks

Related questions

Question

Vertical analysis (common-size) percentages for Baker Company’s sales revenue, cost of goods sold, and expenses are as follows. Did Baker’s net income as a percent of sales increase, decrease, or remain unchanged over the 3-year period? Provide numerical support for your answer.

Vertical Analysis	2020	2019	2018
Sales revenue	100.0%	100.0%	100.0%
Cost of goods sold	60.0	63.9	65.0
Expenses	26.0	26.6	27.5

Expert Solution

Step 1

Net income= Sales revenue- cost of good sold-expense.

	2020	2019	2018
Sales	100%	100%	100%
Less COGS	60%	63.9%	65%
Less Expenses	26%	26.6%	27.5%
Net Income	14.00%	9.50%	7.50%

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

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