percentages?
5-27 The December 31, 2014 income statement accounts and other information of Lyon's
Hardware are shown below:
Advertising expense $ 4,300
Depreciation expense: store equipment 1,600
Depreciation expense: building (store) 3,700
Depreciation expense: office equipment 2,300
Depreciation expense: building (office) 1,100
Interest revenue 1,700
Interest expense 900
-Cost of goods sold 63,900
Insurance expense 350
-Sales (net) 102,000
Office supplies expense 480
Store supplies expense 800
Sales salaries expense 5% of net sales
Office salaries expense 2,600
Utilities expense (store) 1,500
Utilities expense (office) 400
Required: (1) Prepare a classified 2014 income statement for Lyon's Hardware.
(2) Compute the profit margin for 2014. If the profit margin for 2013 was
12.5%, what can be said about the 2014 results?
