Prepare a comparative income statement

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Question - For 20Y2, McDade Company reported a decline in net income. At the end of the year, T. Burrows, the president, is presented with the following condensed comparative income statement:

McDade Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1

 

20Y2

20Y1

Sales

$414,440

$380,000

Cost of merchandise sold

288,000

240,000

Gross profit

$126,440

$140,000

Selling expenses

$40,000

$32,000

Administrative expenses

23,600

20,000

Total operating expenses

$63,600

$52,000

Income from operations

$62,840

$88,000

Other revenue

2,045

1,600

Income before income tax expense

$64,885

$89,600

Income tax expense

18,200

26,900

Net income

$46,685

$62,700

Required - Prepare a comparative income statement with horizontal analysis for the two-year period, using 20Y1 as the base year.

Reference no: EM133091911

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