Question

Problem 17-1A Ratios, common-size statements, and trend percents LO P1, P2, P3

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Selected comparative financial statements of Korbin Company follow:

KORBIN COMPANY
Comparative Income Statements
For Years Ended December 31, 2014, 2013, and 2012
			2014				2013				2012
Sales		$	458,212			$	351,028			$	243,600
Cost of goods sold			275,844				221,499				155,904
Gross profit			182,368				129,529				87,696
Selling expenses			65,066				48,442				32,155
Administrative expenses			41,239				30,890				20,219
Total expenses			106,305				79,332				52,374
Income before taxes			76,063				50,197				35,322
Income taxes			14,148				10,290				7,170
Net income		$	61,915			$	39,907			$	28,152

KORBIN COMPANY
Comparative Balance Sheets
December 31, 2014, 2013, and 2012
			2014				2013				2012
Assets
Current assets		$	46,384			$	36,290			$	48,511
Long-term investments			0				400				4,380
Plant assets, net			86,141				91,997				53,726
Total assets		$	132,525			$	128,687			$	106,617
Liabilities and Equity
Current liabilities		$	19,349			$	19,174			$	18,658
Common stock			70,000				70,000				52,000
Other paid-in capital			8,750				8,750				5,778
Retained earnings			34,426				30,763				30,181
Total liabilities and equity		$	132,525			$	128,687			$	106,617

Problem 17-1A Part 2

2.	Complete the below table to calculate income statement data in common-size percents. (Round your answers to 2 decimal places.)

      

3. Complete the below table to calculate the balance sheet data in trend percents with 2012 as the base year. (Round your answers to 2 decimal places.)

     

Answer 1

Answer 2.

KORBIN COMPANY
Common-Size Comparative Income Statement
For the years ended December 31, 2014, 2013, 2012
	2014	2013	2012
Sales	100.00 %	100.00 %	100.00 %
Cost of goods sold ( COGS / Sales *100)	60.20 %	63.10 %	64.00 %
Gross Profit (Gross profit / sales * 100)	39.80 %	36.90 %	36.00 %
Selling Expenses (Selling Expenses / sales * 100)	14.20 %	13.80 %	13.20 %
Administrative Expenses (Administrative Expenses / sales * 100)	9.00 %	8.80 %	8.30 %
Total Expenses (total Expenses / sales * 100)	23.20 %	22.60 %	21.50 %
Income Before Tax	16.60 %	14.30 %	14.50 %
Income Tax	3.09 %	2.93 %	2.94 %
Net Income	13.51 %	11.37 %	11.56 %

Answer 3.

		Balance sheet data in trend %
		2014 (Amount of 2014 / Amount of 2012)	2013 (Amount of 2014 / Amount of 2012)	2012
	Assets
	Current assets	95.62%	74.81%	100%
	Long-Term investments	0.00%	9.13%	100%
	Plant assets,net	160.33%	171.23%	100%
	Total assets	124.30%	120.70%	100%
	Liabilities and equity
	Current liabilities	103.70%	102.77%	100%
	Common stock	134.62%	134.62%	100%
	Other paid-in-capital	151.44%	151.44%	100%
	Retained earnings	114.07%	101.93%	100%
	Total liabilities and equity	124.30%	120.70%	100%