1 Income statement. In an accounting conference, discussion turned to the possIbinty of pre paring financial statemen ts from a few key accounts, together with financial or cost ratios. The assistant controller of a participating firm provided the following data: pretax income for the year, $1,200,000; pretax income rate on sales. 10%: gross profit rate, 40%; rate of marketing expenses to sales, 15%; 5% bonds payable represent 37.5% of the total liabilities of $2,000,000. Bequired: An income statement for the vear based on the above information.
1 Income statement. In an accounting conference, discussion turned to the possIbinty of pre paring financial statemen ts from a few key accounts, together with financial or cost ratios. The assistant controller of a participating firm provided the following data: pretax income for the year, $1,200,000; pretax income rate on sales. 10%: gross profit rate, 40%; rate of marketing expenses to sales, 15%; 5% bonds payable represent 37.5% of the total liabilities of $2,000,000. Bequired: An income statement for the vear based on the above information.
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter9: Metric-analysis Of Financial Statements
Section: Chapter Questions
Problem 9.17E: Profitability metrics The following selected data were taken from the financial statements of The...
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