90.2K

Verified Solution

Link Copied!

Horizontal analysis of income statement Macklin Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 \begin{tabular}{|c|c|c|} \hline & 20Y2 & 20Y1 \\ \hline Sales & $477,526 & $437,000 \\ \hline Cost of goods sold & (336,000) & (280,000) \\ \hline Gross profit & $141,526 & $157,000 \\ \hline Selling expenses & $(46,250) & $(37,000) \\ \hline Administrative expenses & (27,140) & (23,000) \\ \hline Total operating expenses & $(73,390) & $(60,000) \\ \hline Operating income & $68,136 & $97,000 \\ \hline Other revenue & 2,228 & 1,800 \\ \hline Income before income tax expense & $70,364 & $98,800 \\ \hline Income tax expense & (19,700) & (29,600) \\ \hline Net income & $50,664 & $69,200 \\ \hline \end{tabular} Required: Macklin Inc. Comparative Income Statement For the Years Ended December 31, 20 Y2 and 20Y1 \begin{tabular}{|c|c|c|c|c|} \hline & & & \multicolumn{2}{|c|}{\begin{tabular}{l} Increase/ Increase/ \\ (Decrease) (Decrease) \end{tabular}} \\ \hline Line Item Description & 20Y2 & 20Y1 & Amount & Percent \\ \hline Sales & $477,526 & $437,000 & & % \\ \hline Cost of goods sold & (336,000) & (280,000) & & % \\ \hline Gross profit & $141,526 & $157,000 & $ & % \\ \hline Selling expenses & $(46,250) & $(37,000) & $ & % \\ \hline Administrative expenses & (27,140) & (23,000) & & % \\ \hline Total operating expenses & $(73,390) & $(60,000) & $ & % \\ \hline Operating income & $68,136 & $97,000 & & % \\ \hline Other revenue & 2,228 & 1,800 & & % \\ \hline Income before income tax expense & $70,364 & $98,800 & $ & % \\ \hline Income tax expense & (19,700) & (29,600) & & % \\ \hline Net income & $50,664 & $69,200 & $ & % \\ \hline \end{tabular} 2. Net income has from 20Y1 to 20Y2. Sales have ; however, the cost of goods sold has at a faster rate than sales, causing the gross profit to

Answer & Explanation Solved by verified expert

See Answer