GNBExam16

GNBExam16 - GNB 12e Practice Exam Chapter 16 1. The...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
GNB 12e Practice Exam – Chapter 16 1. The following information pertains to the Pointe Company: 2009 2008 Revenues $100,000 $80,000 Cost of sales 50,000 40,000 Selling and administrative expense 20,000 10,000 Interest expense 5,000 3,000 Net income $ 25,000 $27,000 Based on this information, perform comparative and common-size analyses of the company’s performance for the two years presented. Comparative (horizontal analysis) looks at how performance has been over time (e.g. year-to-year), while common size (vertical) analysis looks at the relative percentages of the items within a financial statement. Pointe Company Comparative and Common-Size Analysis 2009 and 2008 2009 % 2008 % $ Change % Change Revenues $100,000 100 $80,000 100 $20,000 + 25% Cost of sales 50,000 50 40,000 50 10,000 + 25% Gross margin 50,000 50 40,000 50 10,000 + 25% Selling & admin. expense 20,000 20 10,000 12 10,000 +100% Interest expense 5,000 5 3,000 4 2,000 + 67% Net income $ 25,000 25 $27,000 (34) $(2,000) 7% Based on the analysis above, it appears that while the company’s sales have increased significantly from
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 07/15/2010 for the course ECON 137A taught by Professor Watson during the Fall '08 term at UCSB.

Page1 / 2

GNBExam16 - GNB 12e Practice Exam Chapter 16 1. The...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online