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In: Accounting

Sales $ 7,400,000 $ 5,624,000 Cost of goods sold 4,720,000 3,508,500 Gross margin 2,680,000 2,115,500 Selling...

Sales $ 7,400,000 $ 5,624,000
Cost of goods sold 4,720,000 3,508,500
Gross margin 2,680,000 2,115,500
Selling and administrative expenses:
Selling expenses 1,372,000 1,082,000
Administrative expenses 710,500 608,500
Total expenses 2,082,500 1,690,500
Net operating income 597,500 425,000
Interest expense 105,000 93,000
Net income before taxes $ 492,500 $ 332,000

Members of the company’s board of directors are surprised to see that net income increased by only $160,500 when sales increased by $1,776,000.

Required:

1. Express each year's income statement in common-size percentages.

Solutions

Expert Solution

ekkarill92 answered 2 years ago
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