Answer:
Prince Company
1. Component percentages for 2015:
Income statement 2015 Percentage
Sales Revenue 190,900 100%
Cost of goods sold 113,000 59% (113,000/190,900 * 100)
Gross Profit 77,900 41% (77,900/190,900 * 100)
Operating expenses and
interest expense 56,700 30% (56,700/190,900 * 100)
Pretax income 21,200 11% (21,200/190,900 * 100)
Income Tax 6,200 3% (6,200/190,900 * 100)
Net Income 15,000 8% (15,000/190,900 * 100)
Balance Sheet 2015 Percentage
Cash $4,600 4.3% (4,600/106,600 * 100)
Accounts Receivable (net) 15,300 14.4% (15,300/106,600 * 100)
Inventory 40,300 37.8% (40,300/106,600 * 100)
Operational Assets (net) 46,400 43.5% (46,400/106,600 * 100)
Total 106,600 100%
Current liabilities (no interest) 15,100 14.2% (15,100/106,600 * 100)
Long-term liabilities (10%interest) 44,900 42.1% (44,900/106,600 * 100)
Common Stock (par $5) 29,900 28% (29,900/106,600 * 100)
Retained Earnings 16,700 15.7% (16,700/106,600 * 100)
Total 106,600 100%
2. Gross profit percentage for 2015: 41%
Explanation:
a) Data and Calculations:
Income statement 2015 2014
Sales Revenue 190,900 167,300
Cost of goods sold 113,000 102,000
Gross Profit 77,900 65,300
Operating expenses and
interest expense 56,700 53,700
Pretax income 21,200 11,600
Income Tax 6,200 3,100
Net Income 15,000 8,500
Balance Sheet
Cash $4,600 $6,500
Accounts Receivable (net) 15,300 16,900
Inventory 40,300 32,600
Operational Assets (net) 46,400 36,400
Total 106,600 92,400
Current liabilities (no interest) 15,100 16,100
Long-term liabilities (10%interest) 44,900 44,900
Common Stock (par $5) 29,900 29,900
Retained Earnings 16,700 1,500
Total 106,600 92,400
