Cunco Company's income statements for the last 3 ycars are as follows: Cunco Company Income Statements For the Years 1, 2, and 3 Year 1 Year 2 Year 3 $ 1,700,000 (1,000,000) $ 700,000 Sales $1,000,000 $1,200,000 Less: Cost of goods sold Gross margin (700,000) $ 300,000 (700,000) $ 500,000 Less operating expenses: Selling expenses (150,000) (50,000) $ 100,000 (25,000) $ 75,000 (250,000) (220,000) (60,000) $ 220,000 (25.000) $ 195,000 (120,000) $ 330,000 Administrative expenses Operating income Less: Interest expense Income before taxes (25,000) $ 305,000
Cunco Company's income statements for the last 3 ycars are as follows: Cunco Company Income Statements For the Years 1, 2, and 3 Year 1 Year 2 Year 3 $ 1,700,000 (1,000,000) $ 700,000 Sales $1,000,000 $1,200,000 Less: Cost of goods sold Gross margin (700,000) $ 300,000 (700,000) $ 500,000 Less operating expenses: Selling expenses (150,000) (50,000) $ 100,000 (25,000) $ 75,000 (250,000) (220,000) (60,000) $ 220,000 (25.000) $ 195,000 (120,000) $ 330,000 Administrative expenses Operating income Less: Interest expense Income before taxes (25,000) $ 305,000
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 38E: Sundahl Companys income statements for the past 2 years are as follows: Refer to the information for...
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Question
Refer to the information for Cuneo Company above.
Required:
1. Prepare a common-size income statement for Year 2 by expressing each line item for Year
2 as a percentage of that same line item from Year 1. (Note: Round percentages to the
nearest tenth of a percent.)
2. Prepare a common-size income statement for Year 3 by expressing each line item for Year
3 as a percentage of that same line item from Year 1. (Note: Round percentages to the
nearest tenth of a percent.)
![Cunco Company's income statements for the last 3 ycars are as follows:
Cunco Company
Income Statements
For the Years 1, 2, and 3
Year 1
Year 2
Year 3
$ 1,700,000
(1,000,000)
$ 700,000
Sales
$1,000,000
$1,200,000
Less: Cost of goods sold
Gross margin
(700,000)
$ 300,000
(700,000)
$ 500,000
Less operating expenses:
Selling expenses
(150,000)
(50,000)
$ 100,000
(25,000)
$ 75,000
(250,000)
(220,000)
(60,000)
$ 220,000
(25.000)
$ 195,000
(120,000)
$ 330,000
Administrative expenses
Operating income
Less: Interest expense
Income before taxes
(25,000)
$ 305,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6f345afb-742c-432d-8d7f-8ba8cf78d16d%2Fd57f1dd4-3c9b-4019-b23c-ccfd1662f54a%2Fvztr8vk_processed.png&w=3840&q=75)
Transcribed Image Text:Cunco Company's income statements for the last 3 ycars are as follows:
Cunco Company
Income Statements
For the Years 1, 2, and 3
Year 1
Year 2
Year 3
$ 1,700,000
(1,000,000)
$ 700,000
Sales
$1,000,000
$1,200,000
Less: Cost of goods sold
Gross margin
(700,000)
$ 300,000
(700,000)
$ 500,000
Less operating expenses:
Selling expenses
(150,000)
(50,000)
$ 100,000
(25,000)
$ 75,000
(250,000)
(220,000)
(60,000)
$ 220,000
(25.000)
$ 195,000
(120,000)
$ 330,000
Administrative expenses
Operating income
Less: Interest expense
Income before taxes
(25,000)
$ 305,000
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