Question: Using the information in these abbreviated income statements, create a vertical analysis.
|
|
Year 1
|
Year 2
|
|
Sales
|
$360,000
|
$518,000
|
|
Cost of goods sold
|
220,000
|
316,000
|
|
|
------------------
|
----------------
|
|
Gross margin
|
$140,000
|
$202,000
|
|
Operating expenses
|
110,000
|
152,000
|
|
|
--------------------
|
-----------------
|
|
Net income
|
$30,000
|
$49,400
|
Then perform a horizontal analysis showing the change from year 1 to year 2.