Question

Operating data for Bramble Corp. are presented below.

Answer 1

Answer:

Explanation:

Vertical analysis of financial statement entails the expression of each line of the financial statement as a percentage of a base figure for analysis and evaluation purpose.

In this case , the sales revenue is used as the base figure

Vertical analysis of Bramble corp . Income statement for 2020 / 2019

Item                         2020          %          2019             %

Sales revenue       730,000     100       650,000      100

Cost of goods         480,340     65.8     473,850      72.9

Gross profit             249,660     34.2      176,150       27.1

Selling expenses    105,850      14.5       84,500       13.0

Admin Expenses      50,370        6.9       52,000        8

Operating Expenses 156,220     21.4     136,500       21

Income before tax      93,440      12.8      39,650      6.1

Income tax Expenses 29,930      4.1        26,650      4.1

Net Income                  63,510      8.7         13,000       2