Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current YearPrevious YearSales$ 2,720,000$2,050,000Cost of goods sold1,675,5201,111,100Selling expenses320,960319,800Administrative expenses424,320262,400Income tax expense152,320118,900 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.

Income statement is one of the vital financial statements of the company which states the revenues…

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	$ 2,720,000	$2,050,000
Cost of goods sold	1,675,520	1,111,100
Selling expenses	320,960	319,800
Administrative expenses	424,320	262,400
Income tax expense	152,320	118,900

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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