Business Finance
Analyzing an Income Statement

Question Description

I’m studying for my Business class and don’t understand how to answer this. Can you help me study?

ncome statements are presented in the table below for the Elf Corporation for the years ending December 31, 2010, 2009, and 2008. Write a one-paragraph analysis of Elf Corporation’s profit performance for the period.  The focus of the analysis involves creating a common sized Income Statement for the three years and relating the parts of the statement to draw conclusions, ultimately to find the causes and effects of Elf's performance for those three years.  Respond to at least two of your fellow students' postings. 

     
Elf Corporation Income Statements for the Years Ending December 31

(in millions)

2010

2009

2008

Sales

$700

$650

$550

Cost of goods sold

 350

 325

 275

Gross profit

350

325

275

Operating Expenses:

 

 

 

Administrative

100

100

100

Advertising and marketing

    50

    75

    75

Operating profit

$200

$150

$100

Interest expense

    70

    50

   30

Earnings before tax

$130

$100

$ 70

Tax expense (50%)

     65

    50

     35

Net income

  65

$   50

  35


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Final Answer

khakaan (1456)
UCLA

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