Question

b. A $1,760 pulc and a credit to Accounts Payable. Journalize the entries to correct the errors. Omit explanations. OBJ. 5 EX 2-23 Horizontal analysis of income statement in Prior The following data (in millions) are taken from the financial statements of Target Corporation: Recent Year Year $72,618 $71,279 Operating expenses 68,083 66,109 Operating income $ 4,535 $ 5,170 Revenue a. For Target Corporation, determine the amount of change in millions and the percent of change (round to one decimal place) from the prior year to the recent year for: 1. Revenue 2. Operating expenses 3. Operating income b. What conclusions can you draw from your analysis of the revenue and the total operating expenses?

Answer 1

a) Horizantal analysis of Income statement :- Particulars Recent Year $ Prior Year $ Revenue 72,618 71,279 Less: Operating expenses 68,083 66,109 Operating Income 4,535 5,170 Increase 1.88% Increase 1,339 1,974 (635) 2.99% -12.28% b) Revenues has been increased by 1.88% in current year compared to prior year, however operating expenses has been increased by 2.99% which is more than 1.5 times of sales of increases. Hence Operating income dropped by 12.28%.