4:1) 0%(4) FriDec 15322 PM rn/takeAssignment/printUntakenAssig nmentid-698018 Ce

Question

4:1) 0%(4) FriDec 15322 PM rn/takeAssignment/printUntakenAssig nmentid-698018 CengageNowv2 | Online teaching and learning resource from Cengage Leaming Show He How Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhia's data are expressed in dollars. The electronics industry averages are expressed in percentages Industry Sales Cost of goods sold Gross proft Selling expenses $1,880,000 1,165,600 714,400 $432,400 169,200 $601,600 112,800 37,600 $150,400 18,800 $131,600 56,400 $75,200 100 % 65 35% 20% 29% Total operating expenses Operating income Other income 6% 8% Other expense 7% Income before income tax of operations tor Tannenhit Company with the industry average. Ir requred, round percentages to ene decinal place. Enter all amounts as positive numbers

Explanation / Answer

(a) Common Size Income Statement Tannenhill Company Common Sized income Statement for the year Ended december 31 Amount in $ Tannenhill Company Electronics Industry average Sales 1880000 100.0% 1880000/1880000 100% Cost of goods sold 1165600 62.0% 1165600/1880000 65% gross profit 714400 38.0% 714400/1880000 35% Selling Expenses 432400 23.0% 432400/1880000 20% Administrative Expenses 169200 9.0% 169200/1880000 9% Total Operating expenses 601600 32.0% 601600/1880000 29% Operating Income 112800 6.0% 112800/1880000 6% other income 37600 2.0% 37600/1880000 2% 150400 8.0% 150400/1880000 8% Other Expense 18800 1.0% 18800/1880000 1% Income before income tax 131600 7.0% 131600/1880000 7% Income tax expense 56400 3.0% 56400/1880000 3% Net Income 75200 4.0% 75200/1880000 4% (b) The company is managing cost of goods manufacturing Product Lower then Industry, and has Slightly higher in selling & admin expenses . The combined impact causes net income as a persentage of sales to be same then the industry Average

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