Below is the comparative income statement of Variline, Inc. EEB (Click the icon

Question

Below is the comparative income statement of Variline, Inc. EEB (Click the icon to view the comparative income statement.) Requirements 1. Prepare a horizontal analysis of the comparative income statement of Variline, Inc. Round percentage changes to the nearest tenth of a percent. 2. Why did net income increase by a higher percent than total revenues increased during 2016 Requirement 1. Prepare a horizontal analysis of the comparative income statement of Variline, Inc. Round percentage changes to the nearest tenth of a percent, X.x%. (Use a minus sign or parentheses for a decrease.)

Explanation / Answer

a) Horizontal Analysis of Comparative Income Statement :-

Particulars 2016 2015 Amount($) Percentage(%) Revenue $512000 $464300 47700 10.27% Expenses:- Cost of Goods Sold 257000 236000 21000 8.9% Selling and General Expenses 124300 118800 5500 4.63% Interest Expense 4000 5000 (1000) (20%) Income Tax Expense 48800 37700 11100 29.44% Total Expenses 434100 397500 36600 9.21% Net Income 77900 66800 11100 16.62%

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