A company has net sales of $97,500, cost of goods sold of $37,000, gross profit of $60,500, total operating expenses of $12,675, and net income of $47,825. Rounded to the nearest tenth of a percent, what would the vertical analysis of the income statement have for total operating expenses?
A) 34.3%
B) 26.5%
C) 21.0%
D) 13.0%

Question

Quizplus · Accepted Answer

Vertical analysis involves expressing each item in the income statement as a percentage of net sales. Total operating expenses are $12,675, and net sales are $97,500. The calculation is ($12,675 / $97,500) * 100 = 13.0%.

A Company Has Net Sales of $97,500, Cost of Goods