Comparative Statements for Kool Corporation Are Shown Below Calculate Trend Percentages for All Income Statement Amounts Shown and

question 173

Essay

Comparative statements for Kool Corporation are shown below:
$\begin{array}{c} \text { KOOL CORPORATION}\\ \text { Comparative Income Statement}\\ \text { For the Years Ended December 31}\\ \begin{array}{|l|r|r|r|}\hline&2014&2013&2012\\\hline \text { Sales } & \$ 14,800 & \$ 13,229 & \$ 13,994 \\\hline \text { Cost of goods sold } & 8,225 & 8,661 & 8,375 \\\hline \text { Gross profit } & 6,575 & 4,568 & 5,619 \\\hline \text { Operating expenses } & \underline{3,664} & \underline{3,576} & \underline{3,487} \\\hline \text { Operating income } & \$ 2.911 & \$ 992 & \$ 2.132\\\hline\end{array}\end{array}$

Calculate trend percentages for all income statement amounts shown and comment on the results.Use 2012 as the base year.

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Definitions:

Inventory

An accounting term referring to the goods and materials held by a business for the purpose of resale or production.

Lot-For-Lot

An ordering system where the exact quantity needed for production is ordered, minimizing inventory holding costs.

EOQ Lot-Sizing

An inventory management technique that determines the optimal order size to minimize the sum of ordering, holding, and stockout costs.

Setup Cost

The expenses incurred to prepare equipment or a production process for manufacturing a new batch of products, including costs for labor, tools, and materials.