Bundle: Managerial Accounting, Loose-leaf Version, 14th - Book Only
14th Edition
ISBN: 9781337541398
Author: Carl Warren; James M. Reeve; Jonathan Duchac
Publisher: Cengage Learning
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Chapter 6, Problem 3ADM
A.
To determine
Segment Analysis
Business can be classified by regions, products or services, types of customers and more; each classification is treated as one segment of the business. Revenues earned from different segments individually are called segment revenue. Segment revenues are determined from the invoiced data entered into the accounting system. Segment analysis is done to analyze the contribution of different segments to the total operating performance of the company. It is done with the help of horizontal and vertical comparisons.
Horizontal Analysis
This analysis is done to show the trend of various components in financial statements over a period of time. The earliest period is used as the base period and components of financial statements of later periods are compared with the components of the base period.
Vertical analysis
Vertical analysis is the method of financial statement analysis, and it is useful for evaluating company’s performance and financial condition. Vertical analysis is helpful for analyzing the changes in the financial statements over the time, and comparing each item on a financial statement with a total amount from the same statement.
To prepare: A vertical analysis of the sales as a percent of total sales of Company A.
B.
To determine
To prepare: A horizontal analysis of the sales as a percent of total sales Company A.
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Students have asked these similar questions
Adams Company reported the following operating results for two consecutive years:
Required
Compute each income statement component for each of the two years as a percent of sales.
Note: Percentages may not add exactly due to rounding. Round your answers to 1 decimal place. (i.e., .234 should be entered as
23.4).
Sales
Cost of goods sold
Gross margin on sales
Operating expenses
Income before taxes
Income taxes
Net income
ADAMS COMPANY
Vertical Analysis of Income Statements
Year 4
Percentage of
Sales for Year 4
100.0
%
$
$
X Answer is not complete.
999,500
549,725
449,775
129,400
320,375
81,000
239,375
%
$
$
Year 3
1,081,500
598,400
483,100
152,000
331,100
80,400
250,700
Percentage of
Sales for Year 3
100.0 %
%
1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round to one decimal place. Enter all amounts as positive numbers.
Fielder Industries Inc.
Comparative Income Statement
For the Years Ended December 31, 20Y2 and 20Y1
20Y2 Amount
20Y2 Percent
20Y1 Amount
20Y1 Percent
Sales
$1,300,000
fill in the blank bcf5f3fbd02f054_1%
$1,180,000
fill in the blank bcf5f3fbd02f054_2%
Cost of goods sold
682,500
fill in the blank bcf5f3fbd02f054_3%
613,600
fill in the blank bcf5f3fbd02f054_4%
Gross profit
$617,500
fill in the blank bcf5f3fbd02f054_5%
$566,400
fill in the blank bcf5f3fbd02f054_6%
Selling expenses
$260,000
fill in the blank bcf5f3fbd02f054_7%
$188,800
fill in the blank bcf5f3fbd02f054_8%
Administrative expenses
169,000
fill in the blank bcf5f3fbd02f054_9%
177,000
fill in the blank bcf5f3fbd02f054_10%
Total operating expenses
$429,000
fill in the blank…
Assume the following sales data for a company:Current year$832,402 Preceding year608,082What is the percentage increase in sales from the preceding year to the current year?
a.136.89%
b.36.89%
c.73.05%
d.26.95%
The relationship of $242,729 to $104,267, expressed as a ratio, is
a.0.8
b.2.3
c.0.4
d.0.7
Chapter 6 Solutions
Bundle: Managerial Accounting, Loose-leaf Version, 14th - Book Only
Ch. 6 - What types of costs are customarily included in...Ch. 6 - Which type of manufacturing cost (direct...Ch. 6 - Which of the following costs would be included in...Ch. 6 - In the variable costing income statement, how are...Ch. 6 - Prob. 5DQCh. 6 - Discuss how financial data prepared on the basis...Ch. 6 - Prob. 7DQCh. 6 - Explain why rewarding sales personnel on the basis...Ch. 6 - Prob. 9DQCh. 6 - Prob. 10DQ
Ch. 6 - Explain why service companies use different...Ch. 6 - Prob. 1BECh. 6 - Prob. 2BECh. 6 - Prob. 3BECh. 6 - Prob. 4BECh. 6 - Contribution margin by segment The following...Ch. 6 - Prob. 6BECh. 6 - Prob. 1ECh. 6 - Prob. 2ECh. 6 - Prob. 3ECh. 6 - Prob. 4ECh. 6 - Variable costing income statement On November 30,...Ch. 6 - Absorption costing income statement On March 31....Ch. 6 - Prob. 7ECh. 6 - Prob. 8ECh. 6 - Prob. 9ECh. 6 - Prob. 10ECh. 6 - Prob. 11ECh. 6 - Prob. 12ECh. 6 - Prob. 13ECh. 6 - Prob. 14ECh. 6 - Prob. 15ECh. 6 - Prob. 16ECh. 6 - Prob. 17ECh. 6 - Prob. 18ECh. 6 - Prob. 19ECh. 6 - Variable costing income statement for a service...Ch. 6 - Prob. 21ECh. 6 - Variable costing income statement for a service...Ch. 6 - Prob. 1PACh. 6 - Prob. 2PACh. 6 - Prob. 3PACh. 6 - Salespersons report and analysis Walthman...Ch. 6 - Prob. 5PACh. 6 - Prob. 6PACh. 6 - Absorption and variable costing income statements...Ch. 6 - Income statements under absorption costing and...Ch. 6 - Absorption and variable costing income statements...Ch. 6 - Prob. 4PBCh. 6 - Prob. 5PBCh. 6 - Prob. 6PBCh. 6 - Prob. 1ADMCh. 6 - Prob. 2ADMCh. 6 - Prob. 3ADMCh. 6 - Prob. 4ADMCh. 6 - Prob. 1TIFCh. 6 - Inventory effects under absorption costing BendOR,...Ch. 6 - Prob. 3TIF
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