Extracted text: Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry averages are expressed in percentages. Electronics Tannenhill Industry Company Average Sales $2,320,000 100 % Cost of merchandise sold 1,624,000 73 Gross profit $696,000 27 % Selling expenses $394,400 15 % Administrative expenses 162,400 Total operating expenses $556,800 21 % Income from operations $139,200 6 % Other revenue and expense: Other revenue 46,400 2 Other expense (23,200) Income before income tax expense $162,400 7 % Income tax expense 69,600 Net income $92,800 3 %
Extracted text: a. Prepare a common-sized income statement comparing the results of operations for Tannenhill Company with the industry average. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Tannenhill Company Common-Sized Income Statement For the Year Ended December 31 Tannenhill Tannenhill Electronics Company Company Industry Amount Percent Average Sales $2,320,000 % 100.0% Cost of merchandise sold 1,624,000 % 73% Gross profit $696,000 % 27% Selling expenses $394,400 15% Administrative expenses 162,400 % 6% Total operating expenses $556,800 % 21% Income from operations $139,200 % 6% Other revenue and expense: Other revenue 46,400 % 2% Other expense (23,200) % 1% Income before income tax $162,400 % 70% Income tax expense 69,600 % 4% Net income $92,800 % 3% b. The company is managing the cost of manufacturing product than the industry, and has slightly selling and administrative expenses relative to the industry. The combined impact causes net income as a percent of sales to be * than the industry average.