Analyzing Comparative Financial Statements Using Percentages
The comparative financial statements prepared at December 31, 2012, for Prince Company showed the following summarized data:
| 2012 | 2011 |
Income Statement | ||
Sales revenue | $190,000* | $167,000 |
Cost of goods sold | 112,000 | 100,000 |
Gross profit | 78,000 | 67,000 |
Operating expenses and interest expense | 56,000 | 53,000 |
Pretax income | 22,000 | 14,000 |
Income tax | 8,000 | 4,000 |
Net income | $ 14,000 | $ 10,000 |
Balance Sheet | ||
Cash | $ 4,000 | $ 7,000 |
Accounts receivable (net) | 14,000 | 18,000 |
Inventory | 40,000 | 34,000 |
Operational assets (net) | 45,000 | 38,000 |
| $103,000 | $ 97,000 |
Current liabilities (no interest) | $ 16,000 | $ 17,000 |
Long-term liabilities (10% interest) | 45,000 | 45,000 |
Common stock (par $5) | 30,000 | 30,000 |
Retained earnings† | 12,000 | 5,000 |
| $103,000 | S 97,000 |
*One third was credit sales.
*During 2012. cash dividends amounting to $3,000 were declined and paid.
Required:
1. Complete the following columns for each item in the preceding comparative financial statements:
INCREASE (DEC REASE) 2012 OVER 20II | |
Amount | Percent |
2. By what amount did working capital change?
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