E13-16A Prepare a horizontal analysis of the comparative income statements of Ga
ID: 2497768 • Letter: E
Question
E13-16A
Prepare a horizontal analysis of the comparative income statements of Garza Music Co. Round percentage changes to the nearest one-tenth percent (three decimal places).
2014 2013
Total Revenue 971,000 868,000
Expenses:
Cost of Goods Sold 437,000 408,750
Selling and general expenses 287,000 265,000
Interest Expense 23,500 13,500
Income Tax Expense 105,500 84,650
Total Expenses 853,000 771,900
Net Income 118,000 96,100
E13-19A Prepare a comparative common-size income statement for Garza Music Co., using the 2014 and 2013 data of E13-16A and rounding to four decimal places.
Explanation / Answer
Garza Music Co
comparative common-size income statement
Normal Income statement Common size Income statement
2014 2013 2014 2013
Revenues $971,000 $868,000 100% 100%
Expenses
Cost of goods sold $ 437,000 $ 408,750 45.00% 47.09%
----------------- --------------- ------------ -----------
Gross Profit $ 534,000 $ 459,250 55.00% 52.91%
Selling and general expenses $ 287,000 $ 265,000 29.56% 30.53%
Interest expense $ 23,500 $ 13,500 2.42% 1.56%
Income tax expense $ 105,500 $ 84,650 10.87% 9.75%
--------------- -------------- ----------- -----------
Net Income $ 118,000 $ 96,100 12.15% 11.07%
========= ======== ====== ========
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.