Question

BiltMore Bicyle Corporation+B2:C23B14B2:C22
Consolidated Income Statement
For the Year Ended December 31, 2018
Revenue
Sales	57,304,000
Sale Return	-221,600
Net Sales	57,082,400
Cost of Goods sold	-5,771,950
Contribution Margin	51,310,450
Expenses:
Corporate Salaries	3500000
Corporate benefits	1250000
Salaries and benefits (retail staff)	398,268
Utility expense	145,400
Supply expense	1,540,000
Interest expense	700,000
Marketing cost	210,000
Contribution and Community Involvement	58,000
Direct Cost	9,196,000
Labor: Variable	1,408,000
Labor: fixed	1,280,000
Supervision	1,200,000
Energy: Variable	1,440,000
Energy:fixed	1,240,000
Depreciation	2,700,000
Head office	2,280,000
Other cost	2,967,000
Total Expenses	31,512,668
Operating Income	19,797,782
Income tax	5,741,356.78
Net Income	14,056,425.22
Profit margin complete a vertical analysis where total Sales = 100%. Then compute the following financial ratios: Contribution Margin % Profit Margin %	27%

Answer 1

vertical analysis ​of income statement

	AMOUNT $	Percentage %
sales	57,304,000	100.4%
less: sales returns	-221,600	0.4%
Net sales	57,082,400	100%
- cost of goods sold	-5,771,950	10.11%
Contribution Margin	51,310,450	89.88%
Expenses:
Corporate Salaries	3500000	6.13%
Corporate benefits	1250000	2.19%
Salaries and benefits (retail staff)	398,268	0.7%
Utility expense	145,400	0.25%
Supply expense	1,540,000	2.7%
Interest expense	700,000	1.23%
Marketing cost	210,000	0.37%
Contribution and Community Involvement	58,000	0.10%
Direct Cost	9,196,000	16.11%
Labor: Variable	1,408,000	2.47%
Labor: Fixed	1,280,000	2.24%
Supervision	1,200,000	2.10%
Energy: Variable	1,440,000	2.52%
Energy: Fixed	1,240,000	2.17%
Depreciation	2,700,000	4.73%
Head office	2,280,000	4%
Other cost	2,967,000	5.2%
Total Expenses	31,512,668	55.2%
Operating Income	19,797,782	34.68%
Income tax	5,741,356.78	10.06%
Net Income	14,056,425.22	24.62%

Contribution Margin    =89.88%

​ Profit Margin    =24.62%