Percentage of Change in Net Income from 2023 to 2025
(a) What is the percentage of change in net income from 2023 to 2024?
Amount: $12,000, Percent: -3%
(b) What is the percentage of change in net income from 2024 to 2025?
Amount: $31,040, Percent: 8%
Answer:
The change from 2023 to 2024 is a decrease of 3%, while the change from 2024 to 2025 is an increase of 8%.
To find the percentage of change, we need to calculate the difference between the two amounts and then divide it by the original amount. Let's calculate the percentage of change for each period:
(a) From 2023 to 2024:
- Calculate the difference: $388,000 - $400,000 = -$12,000 (a decrease)
- Divide the difference by the original amount: -$12,000 / $400,000 = -0.03
- Multiply the result by 100 to get the percentage: -0.03 * 100 = -3%
(b) From 2024 to 2025:
- Calculate the difference: $419,040 - $388,000 = $31,040 (an increase)
- Divide the difference by the original amount: $31,040 / $388,000 = 0.08
- Multiply the result by 100 to get the percentage: 0.08 * 100 = 8%
The percentage of change from 2023 to 2024 is -3%, indicating a decrease, while the percentage of change from 2024 to 2025 is 8%, indicating an increase. Understanding the changes in net income over the years is crucial for financial analysis and decision-making.