Questions -
Q1. Condensed data taken from the ledger of Collins Company at December 31, 2006, and 2007, are as follows:
2007 2006
Current assets $ 200,000 $ 180,000
Property, plant and equipment 450,000 400,000
Intangible assets 20,700 30,000
Current liabilities 70,000 80,000
Long-term liabilities 200,000 250,000
Common Stock 275,000 200,000
Retained Earnings 125,700 80,000
Prepare a comparative balance sheet, with horizontal analysis, for December 31. 2006 and 2007. (Round percents to one decimal point.)
Q2. Revenue and expense data for Wilson Company are as follows:
2006 2005
Administrative expenses $ 24,750 $ 18,000
Cost of goods sold 487,500 375,000
Income Tax 15,000 12,000
Net sales 750,000 600,000
Selling expenses 182,500 154,800
(a) Prepare a comparative income statement, with vertical analysis, stating each item for both 2006 and 2005 as a percent of sales.
(b) Comment upon the significant changes disclosed by the comparative income statement.