Income statements for Thornton Company for Year 3 and Year 4 follow: THORNTON COMPANY Income Statements Year 4 Sales $201,300 $181,300 Cost of goods sold Selling expenses Administrative expenses 000'EFT 000'tZI 20,500 18,500 009'ZI 009 5T 3,300 5,300 Interest expense Total expenses 00'6LTS $159, 400 006 Income before taxes 006'1Z 3,400 Income taxes expens3e 6,200 $ 15,700 $ 18,500 Net income Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.

Income statements for Thornton Company for Year 3 and Year 4 follow: THORNTON COMPANY Income Statements Year 4 Sales $201,300 $181,300 Cost of goods sold Selling expenses Administrative expenses 000'EFT 000'tZI 20,500 18,500 009'ZI 009 5T 3,300 5,300 Interest expense Total expenses 00'6LTS $159, 400 006 Income before taxes 006'1Z 3,400 Income taxes expens3e 6,200 $ 15,700 $ 18,500 Net income Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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