Question

Vertical Analysis 2020 2019 Sales Cost of sales Gross profit 900 000 520 000 380 000 140 000 65 000 Selling expenses 870000 100% 460 000 532 410 000 47.12 93 000 $0.3.2 61 000 154 000 256 000 Administrative expenses Total operating expenses 205 000 Profit before income tax 175 000 Income tax expense 52 500 76 800 Profit 122 500 179 200

please explain how to get each numbers

Answer 1

Spectre Ltd. Vertical Analysis For the period ending 2020 2019 $ 100.00% 870000 100.00 % Sales 900000 Cost of Sales 57.78% 52.87% 520000 460000 Gross Profit 42.22% 47.13% 380000 410000 Selling Expenses 15.56% 10.69% 140000 93000 Administrative Expense 7.22% 7.01% 65000 61000 Total Operating Expenses 22.78% 17.70% 205000 154000 Profit before income tax 19.44% 29.43% 175000 256000 5.83% 8.83% Income Tax expense 52500 76800 Profit 13.61% 20.60% 122500 179200

A. E 1 Spectre Ltd. 2 3 Vertical Analysis 4 For the period ending 2019 5 2020 6 7 Sales 900000 1 870000 1 B8/$B$7 D8/$D$7 Cost of Sales 8 520000 460000 B9/$B$7 -D9/$D$7 9 Gross Profit B7-B8 D7-D8 10 Selling Expenses 11 Administrative Expense -B10/$B$7 D10/$D$7 140000 93000 B11/$B$7 D11/$D$7 65000 61000 12 Total Operating Expenses B12/$B$7 B13/$B$7 D12/$D$7 -D13/$D$7 -SUM(B10:B11) -SUM(D10:D11) 13 Profit before income tax =B9-B12 -D9-D12 14 Income Tax expense B14/$B$7 D14/$D$7 52500 76800 B15/$B$7 D15/$D$7 15 Profit -B13- B14 =D13-D14 16