Exercise 14-4 (Part Level Submission) The comparative condensed income statement

Question

Exercise 14-4 (Part Level Submission) The comparative condensed income statements of Emley Corporation are shown below EMLEY CORPORATION Comparative Condensed Income Statements For the Years Ended December 31 Net sales Cost of goods sold Gross profit Operating expenses Net income 2017 $686,400 502,320 184,080 130,000 $54,080 2016 $624,000 435,800 188,200 124,800 $ 63,400 (a) Prepare a horizontal analysis of the income statement data for Emley Corporation using 2016 as a base. (Enter negative amounts and percentages using either a negative sign preceding the number e.g.-45,-45% or parentheses e.g. (45), (4596). Round percentages to 1 decimal place, e.g 12.3%.) EMLEY CORPORATION Condensed Income Statements Increase or (Decrease) During 2017 2017 2016 Amount Percentage Net sales $686,400 $624,000 Cost of goods sold 502,320 435,800 184,080188,200 Operating expenses 130,000 124,800 $54,080 $63,400 0% 0% 0% 0% Gross profit Net income 0%

Explanation / Answer

Answer:

EMLEY CORPORATION Condensed Income Statements Increase or (Decrease) during 2017 2017 2016 Amount (2017 - 2016) Percentage(2017-2016 /2016)*100 Net sales        686,400        624,000                           62,400 10.0% Cost of goods sold        502,320        435,800                           66,520 15.3% Gross profit        184,080        188,200                           (4,120) -2.2% Operating expenses        130,000        124,800                             5,200 4.2% Net income           54,080           63,400                           (9,320) -14.7%

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