Jill Akerley is concerned about her company's financial performance and financial position. She hasobtained the financial statement of her largest competitor, Nova Inc. and notes that the company is over tentimes larger than hers, so it is making the numbers difficult to compare.Below is condensed financial information from Nova Inc. and Scotia Inc.:Nova Inc. and Scotia Inc.Income StatementsFor the years ended August 31, 2024NOVASCOTIASales$5,000,000$400,000Cost of goods sold2,100,000120,000Gross profit2,900,000280,000Operating expenses2,200,000130,000Operating income700,000150,000Interest expense60,00010,000Income before taxes640,000140,000Income taxes150,00030,000Net income$490,000$110,000Required: USING MS EXCELa. Prepare a vertical analysis for the companies calculating the relative percentages of each item in thefinancial statements. (Round your answers to the nearest tenth of a percent, ie 0.13578 → 13.6%)b. Comment on the common-sized income statements of the companies (prepared in part a.

An analysis in which the items so reported are shown in form of percentage of base item is known as…

Jill Akerley is concerned about her company's financial performance and financial position. She has obtained the financial statement of her largest competitor, Nova Inc. and notes that the company is over ten times larger than hers, so it is making the numbers difficult to compare. Below is condensed financial information from Nova Inc. and Scotia Inc.: Nova Inc. and Scotia Inc. Income Statements For the years ended August 31, 2024 NOVA SCOTIA Sales $5,000,000 $400,000 Cost of goods sold Gross profit Operating expenses Operating income 2,100,000 120,000 2,900,000 280,000 2,200,000 130,000 700,000 150,000 Interest expense 60,000 10.000 Income before taxes 640,000 140,000 Income taxes 150,000 30,000 Net income $490,000 $110,000 Required: USING MS EXCEL a. Prepare a vertical analysis for the companies calculating the relative percentages of each item in the financial statements. (Round your answers to the nearest tenth of a percent, ie 0.13578 → 13.6%) b. Comment on the common-sized income statements of the companies (prepared in part a.

Jill Akerley is concerned about her company's financial performance and financial position. She has obtained the financial statement of her largest competitor, Nova Inc. and notes that the company is over ten times larger than hers, so it is making the numbers difficult to compare. Below is condensed financial information from Nova Inc. and Scotia Inc.: Nova Inc. and Scotia Inc. Income Statements For the years ended August 31, 2024 NOVA SCOTIA Sales $5,000,000 $400,000 Cost of goods sold Gross profit Operating expenses Operating income 2,100,000 120,000 2,900,000 280,000 2,200,000 130,000 700,000 150,000 Interest expense 60,000 10.000 Income before taxes 640,000 140,000 Income taxes 150,000 30,000 Net income $490,000 $110,000 Required: USING MS EXCEL a. Prepare a vertical analysis for the companies calculating the relative percentages of each item in the financial statements. (Round your answers to the nearest tenth of a percent, ie 0.13578 → 13.6%) b. Comment on the common-sized income statements of the companies (prepared in part a.

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter3: The Adjusting Process

Section: Chapter Questions

Problem 30E

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