Prepare rate of change analyses for Teicher

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Reference no: EM132880396

Problem - Rate of Change Analyses - Teicher Company presents the following condensed comparative income statements for 2020, 2019, and 2018:

 

For Years Ended December 31,

 

2020

2019

2018

Sales (net)

$120,000

$100,000

$ 85,000

Cost of goods sold

(72,000)

(55,000)

(45,000)

Gross profit

$ 48,000

$ 45,000

$ 40,000

Operating expenses

(22,000)

(20,000)

(18,000)

Operating income

$ 26,000

$ 25,000

$ 22,000

Other items:




Dividend revenue

400

500

200

Interest expense

(1,200)

(1,000)

(500)

Income before income taxes

$ 25,200

$ 24,500

$ 21,700

Income tax expense

(8,200)

(8,000)

(6,000)

Net income

$ 17,000

$ 16,500

$ 15,700

Number of common shares

6,000

6,000

5,000

Earnings per share

$ 2.83

$ 2.75

$ 3.14

Required - Prepare rate of change analyses for Teicher for 2019 and 2020 using year-to-year growth rates. What favorable or unfavorable trends do your analyses reveal about Teicher Company's financial performance?

Reference no: EM132880396

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