2018 2017 Difference Horizontal Analysis Sales Cost of goods sold Gross profit O

Question

2018 2017 Difference Horizontal Analysis Sales Cost of goods sold Gross profit Operating expenses $485,625 $462,500 222,694 208,125 262,931 254,375 Salaries and wages expense Depreclation expense Other operating expenses 147,979 146,350 9,100 42,925 213,765 198,375 56,000 17,600 48,186 Total operating expenses Income from operations 49,166 Other expenses 0 0 0 56,000 14,000 $37,002 $42,000 413 2,500 2,913 46,253 9,251 Interest expense Loss on disposal of plant assets Total other expenses Income before income tax Income tax expense Net income

Explanation / Answer

Comparative Income statement (Amount in $)

a) Statement of cash flows for the year 2018 (Amount in $)

As there is no information relating to current assets and current liablities, further calculation can cot be made.

Particulars 2018 2017 Difference Horizontal Analysis Sales 485,625 462,500 23,125 +5% Less: Cost of goods sold (222,694) (208,125) (14,569) +7% Gross Profit 262,931 254,375 8,556 +3.36% Less: Operating expenses Salaries and wages expense 147,979 146,350 1,629 +1.11% Depreciation expense 17,600 9,100 8,500 +93.41% Other operating expense 48,186 42,925 5,261 +12.26% Total operating expenses 213,765 198,375 15,390 +7.76% Income from operations 49,166 56,000 (6,834) -12.20% Less: Other expenses Interest expense 413 0 413 +100% Loss on disposal of plant assets 2,500 0 2,500 +100% Total other expenses 2,913 0 2,913 +100% Income before income tax 46,253 56,000 (9,747) -17.40% Income Tax expense 9,251 14,000 (4,749) -33.92% Net Income 37,002 42,000 (4,998) -11.90%

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