Question

Exercise 250 Operating data for Panola Land Corporation are presented below. Sales revenue Cost of goods sold Selling expenses Administrative expenses Income tax expense Net Income 2014 $800,000 480,000 120,000 80,000 24,000 96,000 2013 $600,000 390,000 78,000 $4,000 25,000 53,000 Prepare a schedule showing a vertical analysis for 2014 and 2013. (Round percentage answers to 1 decimal place, e.g. 15.2%.) PANOLA LAND COMPANY Condensed Income Statement For the Years Ended December 31 2014 Amount

Answer 1

PANOLA LAND COMPANY
Condensed Income Statement
For the year ended December 31
			2014		2013
			amount	percent	amount	percent
sale revenue			800000	100%	600000	100%
Cost of goods sold			480000	60%	390000	65%
Gross profit			320000	40%	210000	35%
selling expenses			120000	15%	78000	13%
administrative expenses			80000	10%	54000	9%
Total operating expenses			200000	25%	132000	22%
Income before tax			120000	15%	78000	13%
income tax expenses			24000	3%	25000	4.2%
Net income			96000	12%	53000	8.8%

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