Vertical Analysis of Income Statement The following comparative income statement

Question

Vertical Analysis of Income Statement The following comparative income statement (in thousands of dollars) for two recent fiscal years was adapted from the annual report of Speedway Motorsports, Inc., owner and operator of several major motor speedways, such as the Atlanta, Texas, and Las Vegas Motor Speedways Current Year Previous Year Revenues: Admissions Event-related revenue NASCAR broadcasting revenue Other operating revenue $116,034 151,562 192,662 29,902 $490,160 $130,239 163,621 185,394 26,951 $506,205 Total revenues Expenses and other Direct expense of events NASCAR purse and sanction fees Other direct expenses General and administrative $101,402 122,950 18,908 183,215 $426,475 $63,685 $106,204 120,146 20,352 241,223 $487,925 $18,280 Total expenses and other Income from continuing operations a. Prepare a comparative income statement for these two years in vertical form, stating each item as a percent of revenues. Enter all amounts as positive numbers. (Note: Due to rounding, amounts may not total 100%) Round your percentages to one decimal place

Explanation / Answer

Speedway Motorsports, Inc. Comparative Income Statement (In thousands of dollars) For the years Ended December 31 Current Year Amount Current Year Percent Prior Year Amount Prior Year Percent Revenues: Admissions        1,16,034           23.7 % 1,30,239           25.7 % Event-related revenue        1,51,562           30.9 % 1,63,621           32.3 % NASCAR broadcasting revenue        1,92,662           39.3 % 1,85,394           36.6 % Other Operating revenue            29,902             6.1 %      26,951             5.3 % Total Revenues        4,90,160         100.0 % 5,06,205         100.0 % Expenses and Other: Direct expense of events        1,01,402           20.7 % 1,06,204           21.0 % NASCAR purse and sanction fees        1,22,950           25.1 % 1,20,146           23.7 % Other direct Expenses            18,908             3.9 %      20,352             4.0 % General and administative        1,83,215           37.4 % 2,41,223           47.7 % Total expenses and other        4,26,475           87.0 % 4,87,925           96.4 % Income from Continuing operations            63,685           13.0 %      18,280             3.6 %

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