Financial Accounting
3rd Edition
ISBN: 9780133791129
Author: Jane L. Reimers
Publisher: Pearson Higher Ed
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Chapter 10, Problem 17EA
To determine
Perform horizontal analysis for sales using 2006 as a base year and interpret the results.
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A condensed income statement for Weber Associates and a partially completed vertical analysis follow.
Required:
1. Complete the vertical analysis by computing each missing line item as a percentage of net revenues. TIP: In the prior year, Cost of
Goods Sold was 31 percent of Net Revenues, computed as ($1,397 ÷ $4,571).
2. Does Cost of Goods Sold, as a percentage of Net Revenues, represent better or worse performance in 2019 as compared to 2018?
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Complete the vertical analysis by computing each missing line item as a percentage of net revenues. TIP: In the prior year,
Cost of Goods Sold was 31 percent of Net Revenues, computed as ($1,397 ÷ $4,571). (Decreases should be indicated by a
minus sign. Round your answers to the nearest whole percent.)
Net Revenues
Cost of Goods Sold
Research and Development Expense
Sales and Marketing Expense
General and Administrative Expense
Income from Operations
Other…
Selected comparative financial statements of Haroun Company follow.
HAROUN COMPANY
Comparative Income Statements
For Years Ended December 31, 2021-2015
($ thousands)
Sales
2021
Cost of goods sold
$ 1,769
1,271
2020
$ 1,549
2019
2018
2017
2016
2015
$ 1,410
$ 1,292
$ 1,206
$ 1,121
$ 919
1,034
889
778
723
676
539
Gross profit
498
515
521
514
483
445
380
Operating expenses
Net income
377
295
271
200
173
171
142
$ 121
$ 220
$ 250
$ 314
$ 310
$ 274
$ 238
HAROUN COMPANY
Comparative Year-End Balance Sheets
December 31, 2021-2015
($ thousands)
Assets
Cash
Accounts receivable, net
Merchandise inventory
Other current assets
Long-term investments
Plant assets, net
Total assets
Liabilities and Equity
2021
2020
2019
2018
2017
2016
2015
$ 108
773
$ 142
812
$ 148
735
2,797
2,036
1,779
$ 151
564
1,499
$ 157
496
$ 155
$ 160
470
332
1,346
1,144
829
72
65
40
71
60
61
32
e
B
220
220
220
220
3,422
3,409
2,982
1,683
$ 7,172
$ 6,464
$ 5,684
$ 4,188
$ 4,019
1,740
1,546
$ 3,596
$ 2,900
1,327
Current liabilities…
Loomis, Inc. reported the following on the company’s income statement in two recent years:
Please see the image for details:
a. Determine the times interest earned ratio for the current year and the prior year. Round to one decimal place.b. Is this ratio improving or declining?
Chapter 10 Solutions
Financial Accounting
Ch. 10 - Prob. 1YTCh. 10 - Prob. 2YTCh. 10 - Prob. 3YTCh. 10 - Prob. 4YTCh. 10 - Prob. 5YTCh. 10 - Define the items that the Financial Accounting...Ch. 10 - Prob. 2QCh. 10 - Prob. 3QCh. 10 - Prob. 4QCh. 10 - Prob. 5Q
Ch. 10 - Prob. 6QCh. 10 - What is solvency? Which ratios are useful for...Ch. 10 - What is profitability? Which ratios are useful for...Ch. 10 - What are market indicators? Which ratios are...Ch. 10 - Prob. 10QCh. 10 - Prob. 1MCQCh. 10 - Current assets for Kearney Company are 120,000 and...Ch. 10 - Prob. 3MCQCh. 10 - Prob. 4MCQCh. 10 - Prob. 5MCQCh. 10 - Prob. 6MCQCh. 10 - Prob. 7MCQCh. 10 - Prob. 8MCQCh. 10 - Prob. 9MCQCh. 10 - Prob. 10MCQCh. 10 - Prob. 1SEACh. 10 - Prob. 2SEACh. 10 - Prob. 3SEACh. 10 - Prob. 4SEACh. 10 - Prob. 5SEACh. 10 - A five-year comparative analysis of Low Light...Ch. 10 - Prob. 7SEACh. 10 - Prob. 8SEBCh. 10 - Prob. 9SEBCh. 10 - Prob. 10SEBCh. 10 - Perform a vertical analysis on the following...Ch. 10 - Prob. 12SEBCh. 10 - Prob. 13SEBCh. 10 - Use the following information to construct a...Ch. 10 - Prob. 16EACh. 10 - Prob. 17EACh. 10 - Prob. 18EACh. 10 - Prob. 19EACh. 10 - Use the balance sheets from Suzannes Hotels in...Ch. 10 - Prob. 21EACh. 10 - Prob. 22EACh. 10 - Prob. 23EACh. 10 - Use the statements of earnings for Campbell Soup...Ch. 10 - Prob. 25EACh. 10 - Prob. 26EACh. 10 - Prob. 27EACh. 10 - Prob. 28EBCh. 10 - Prob. 29EBCh. 10 - Prob. 30EBCh. 10 - Prob. 31EBCh. 10 - Prob. 32EBCh. 10 - Prob. 33EBCh. 10 - Prob. 34EBCh. 10 - Prob. 35EBCh. 10 - Prob. 36EBCh. 10 - Prob. 37EBCh. 10 - Prob. 38EBCh. 10 - Prob. 39EBCh. 10 - Prob. 40EBCh. 10 - Prob. 41PACh. 10 - Prob. 42PACh. 10 - Prob. 43PACh. 10 - Following are the income statements for Alpha...Ch. 10 - Prob. 45PACh. 10 - Prob. 46PACh. 10 - Prob. 47PACh. 10 - You are interested in investing in Teddy Company,...Ch. 10 - Prob. 49PBCh. 10 - Prob. 50PBCh. 10 - Prob. 51PBCh. 10 - Prob. 52PBCh. 10 - Prob. 53PBCh. 10 - Prob. 54PBCh. 10 - Prob. 55PBCh. 10 - Prob. 56PBCh. 10 - Prob. 1CTPCh. 10 - Prob. 2CTP
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