CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Trend Analysis Common-Size Analysis (In millions, except share and per share amounts) Fiscal Years Ended December 31, 2020-2021 2019-2020 2021 2020 2021 2020 2019 $ Change % Change $ Change % Change (Percent of Net Sales) Net sales 4,900 4,600 5,194 Cost of Goods Sold 3,296 3,240 3,296 GROSS PROFIT Stores and Distribution Expense 980 805 882 Selling, General and Administrative Expense 392 345 490 10 23 29 Other Operating Expense (Income), Net OPERATING INCOME Interest Income (Expense) (1) (5) (2) OPERATING INCOME BEFORE TAXES 98 81 196 Income Tax Expense NET INCOME EARNINGS PER SHARE $4 2$ 2020 Formulas/Links: Calculate the following for: Gross Profit Margin (percentage) Net Profit Margin (percentage) 2021 n/a n/a n/a n/a Select the possible explanations for the change in the Gross Profit Margin from 2020 to 2021:
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Trend Analysis Common-Size Analysis (In millions, except share and per share amounts) Fiscal Years Ended December 31, 2020-2021 2019-2020 2021 2020 2021 2020 2019 $ Change % Change $ Change % Change (Percent of Net Sales) Net sales 4,900 4,600 5,194 Cost of Goods Sold 3,296 3,240 3,296 GROSS PROFIT Stores and Distribution Expense 980 805 882 Selling, General and Administrative Expense 392 345 490 10 23 29 Other Operating Expense (Income), Net OPERATING INCOME Interest Income (Expense) (1) (5) (2) OPERATING INCOME BEFORE TAXES 98 81 196 Income Tax Expense NET INCOME EARNINGS PER SHARE $4 2$ 2020 Formulas/Links: Calculate the following for: Gross Profit Margin (percentage) Net Profit Margin (percentage) 2021 n/a n/a n/a n/a Select the possible explanations for the change in the Gross Profit Margin from 2020 to 2021:
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...
Related questions
Question
can you help me fill out my journal
Expert Solution
Step 1
In order to make decisions from the financial statements prepared by a company, the managers may often use some tools for analysis purposes. Two common methods of such analysis are the common size analysis and the trend analysis. The common size analysis involves the presentation of each amount in the financial statement as a percentage of a base amount that is pre-determined. Because of that kind of analysis, it is also known as vertical analysis.
Trend analysis involves the presentation of the change in data from year to year in currency form and in percentage form. It is also used to compare financial statements of other companies in the same industry.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning