Use the following selected information from Whitman Corp. to determine the Year 1 and Year 2 common size percentages for cost of goods sold using Net sales as the base. Year 2 Year 1 Net sales $505,800 $410,600 Cost of goods sold 214,900 135,050 Operating expenses 78,340 75,500 Net earnings 39,580 28,080

Question

Business

Dillan Murphy

22 July, 14:16

Use the following selected information from Whitman Corp. to determine the Year 1 and Year 2 common size percentages for cost of goods sold using Net sales as the base. Year 2 Year 1 Net sales $505,800 $410,600 Cost of goods sold 214,900 135,050 Operating expenses 78,340 75,500 Net earnings 39,580 28,080

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Buckley · Answer 1

See the explanation section.

Explanation:

Whitman Corp.

Comparative Income Statements

Particulars Year 1 % Year 2 %

Sales $410,600 100 $505,800 100

Cost of goods sold (135,050) (32.89) (214,900) (42.49)

Gross profit 181,900 44.30 406,200 80.31

Operating expenses (75,500) (18.39) (78,340) (15.49)

Net income $28,080 6.84 $39,580 7.83