Express the Following Income Statement Information in Common-Size Percents (Round

question 34

Essay

Express the following income statement information in common-size percents (round to nearest whole percent).Comment on the results.
$\begin{array}{c}\text { THORSTEN CORP. } \\\text {Comparative Income Statement } \\\text {For Years Ended December 31, 2014 and 2013 } \\\begin{array}{|l|r|r|}\hline & \underline { 2014 } & \underline { 2013 } \\\hline \text { Sales } & \$ 1,200,000 & \$ 1,000,000 \\\hline \text { Cost of goods sold } & \underline{804,000} & \underline{650,000} \\\hline \text { Gross profit } & \$ 396,000 & \$ 350,000 \\\hline \text { Selling expenses } & 132,000 & 120,000 \\\hline \text { Administrative expenses } & 180,000 & 150,000 \\\hline \text { Net income } & \underline {\$ 84,000} & \underline {\$ 80,000} \\\hline\end{array}\end{array}$

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Definitions:

Mixed Subsistence Strategy

A way of living that involves combining different methods of obtaining food, such as hunting, gathering, farming, and trading.

Geographical Region

A specific area or section of the world identified by physical, political, or cultural traits.

Industrial Food Production

Large-scale businesses involved in mass food production, processing, and marketing, which primarily rely on labor-saving machines.

Greatest Drawback

The most significant disadvantage or negative aspect associated with a particular situation, decision, or object.