Test:Exam 2 n: Total fixed Time Rema This Question: 1 pt 2 of 32 (9 complete) co

Question

Test:Exam 2 n: Total fixed Time Rema This Question: 1 pt 2 of 32 (9 complete) costs for Green Planes I if 150,000 units are p Gavette Company reported the following information for the current year and prior year Account Net sales revenue COGS Gross Profit Selling/General Exp Net income before tax Income Tax Net Income Current year $367.200 $220,320 $146,880 $85,768 $61,112 $7.344 $53,768 Prior year $300,000 $240,000 $60,000 $12,000 $48,000 3,000 $45,000 Percentage 100% 6) ,091. 0,000. 40.00% 23.36% 2.00% 4,000 What would a vertical analysis report with respect to curent year selling and peneral expenses? ert Answer o CA. An increase of $73,768 16.64% of net sales revenue B. ° C. 23.36% of net sales revenue D. A decrease of 23.36% d $704,000 Total Costs

Explanation / Answer

C. 23.36% of net sales revenue.

The most common use of vertical analysis is to show the expenses incurred as a percentage of total sales or the base figure. Thus line items are converted to percentages in vertical analysis.

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