The Following Information Was Taken from the Financial Statements of Lawson

question 15

Essay

The following information was taken from the financial statements of Lawson Company: $\begin{array}{lcc}&2017&2016\\ \text { Gross profit on sales } & \$ 900,000 & \$ 840,000 \\ \text { Income before income taxes } & 280,000 & 230,000 \\ \text { Net Income. } & 240,000 & 216,0 \\\text { Net income as a percentage of net sales }&8\%&9\%\end{array}$ Instructions
(a) Compute the net sales for each year.
(b) Compute the cost of goods sold in dollars and as a percentage of net sales for each year.
(c) Compute operating expenses in dollars and as a percentage of net sales for each year. (Income taxes are not operating expenses).

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Definitions:

Kitchen Gadget

A small tool or device that is used in the kitchen for food preparation and cooking tasks.

Land

An asset category representing the ground a company owns, which is not subject to depreciation unlike buildings and equipment.

Survey

A method of gathering information from individuals, typically by asking them a series of questions to obtain data or insights.

Government Permits

Official authorizations issued by governmental entities that allow businesses or individuals to conduct certain activities.