Acc557 Financial Accounting: E14-4 The comparative condensed income statements of Hendi Corporation

Acc557 Financial Accounting

Exercise 14-4
The comparative condensed income statements of Hendi Corporation are shown below:
HENDI CORPORATION
Comparative Condensed Income Statements
For the Years Ended December 31
2014 2013
Net sales 600,000 500,000
Cost of goods sold 468,000 400,000
Gross profit 132,000 100,000
Operating expenses 60,000 54,000
Net income 72,000 46,000

Instructions:
(a) Prepare a horizontal analysis of the income statement data for Hendi Corporation using 2013 as a base. (Show the amounts of increase or decrease.) (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000). (20%). Round percentages to 1 decimal place, e.g. 12.3%.)
(b) Prepare a vertical analysis of the income statement data for Hendi Corporation in columnar form for both years. (Round percentages to 1 decimal place, e.g. 12.3%.)
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