Managerial Accounting
3rd Edition
ISBN: 9780077826482
Author: Stacey M Whitecotton Associate Professor, Robert Libby, Fred Phillips Associate Professor
Publisher: McGraw-Hill Education
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Chapter 13, Problem 1E
To determine
(a)
Introduction:
Horizontal analysis is an analysis used to compare the historical data. It shows the changes in the amount of financial statements over the period of time.
To prepare:
Horizontal analysis and compare the changes that have taken place in the price of gas to the changes in total revenue and cost of crude oil.
To determine
(b)
Introduction:
Vertical analysis helps to express each financial statement line item as a percentage of the base year.
To prepare:
Vertical analysis and compare the gross profit per total revenue for both the years.
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Students have asked these similar questions
The average price of a gallon of gas in 2015 dropped $0.94 (28 percent) from $3.34 in 2014 (to $2.40 in 2015)
conduct a horizontal analysis by calculating the year-over-year changes in each line item, expressed in dollars and in percentages for the income statement of Insignia Corporation for the year ended December 31, 2015 (amounts in billions). (Decreases should be indicated by a minus sign)
The average price of a gallon of gas in 2018 increased $0.30 (12.4 percent) from $2.42 in 2017 to $2.72 in 2018.
Required:
1. Conduct a horizontal analysis by calculating the year-over-year changes in each line item, expressed in dollars and in percentages
for the income statement of Bronze, Incorporated for the year ended December 31, 2018 (amounts in billions).
2-a. Conduct a vertical analysis by expressing each line as a percentage of total revenues.
2-b. Excluding income tax and other operating costs, did Bronze earn more gross profit per dollar of revenue in 2018 compared to
2017?
Complete this question by entering your answers in the tabs below.
Req 1
Req 2A
Req 2B
Conduct a horizontal analysis by calculating the year-over-year changes in each line item, expressed in dollars and in
percentages for the income statement of Bronze, Incorporated for the year ended December 31, 2018 (amounts in
billions). (Decreases should be indicated by a minus sign. Enter your answers in billions…
Assume the average price of a litre of gas in 2017 jumped $0.16 (15 percent) from $1.06 in 2010 to $1.22 in 2017. Let's see whether this
change is reflected in the income statement of Petroleum Inc. for the year ended December 31, 2017 (amounts in billions).
2017
2016
Total Revenues
$ 574 $ 524
Costs of Crude Oil and Products
356
397
Other Operating Costs
57
54
Income Before Income Tax Expense
Income Tax Expense
161
73
71
29
Net Income
90 $
44
Required:
1-a. Compute the gross profit percentage for each year. (Round your answers to 1 decimal place.)
Gross Profit
2017
%
2016
1-b. Not available in Connect.
2-a. Compute the net profit margin for each year. (Round your answers to 1 decimal place.)
Net Profit
2017
%
2016
%
Chapter 13 Solutions
Managerial Accounting
Ch. 13 - Prob. 1QCh. 13 - Prob. 2QCh. 13 - What is ratio analysis? Why is it useful?
Ch. 13 - What benchmarks are commonly used for interpreting...Ch. 13 - Prob. 5QCh. 13 - Why are some analyses called horizontal and others...Ch. 13 - Slow Cellar’s current ratio increased from 1.2 to...Ch. 13 - From last year to this year. Colossal Company’s...Ch. 13 - From last year to this year, Berry Barn reported...Ch. 13 - Prob. 10Q
Ch. 13 - Prob. 1MCCh. 13 - Prob. 2MCCh. 13 - Prob. 3MCCh. 13 - Prob. 4MCCh. 13 - Prob. 5MCCh. 13 - Prob. 6MCCh. 13 - Prob. 7MCCh. 13 - Prob. 8MCCh. 13 - Prob. 9MCCh. 13 - Prob. 1MECh. 13 - Prob. 2MECh. 13 - Prob. 3MECh. 13 - Prob. 4MECh. 13 - Prob. 5MECh. 13 - Prob. 6MECh. 13 - Prob. 7MECh. 13 - Prob. 8MECh. 13 - Prob. 9MECh. 13 - Prob. 10MECh. 13 - Prob. 11MECh. 13 - Prob. 12MECh. 13 - Prob. 13MECh. 13 - Prob. 14MECh. 13 - Prob. 1ECh. 13 - Prob. 2ECh. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Prob. 5ECh. 13 - Prob. 6ECh. 13 - Prob. 7ECh. 13 - Computing and Interpreting Liquidity Ratios...Ch. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Prob. 11ECh. 13 - Prob. 12ECh. 13 - Prob. 13ECh. 13 - Analyzing the Impact of Selected Transactions on...Ch. 13 - Prob. 15ECh. 13 - Prob. 1.1GAPCh. 13 - Prob. 1.2GAPCh. 13 - Prob. 2.1GAPCh. 13 - Prob. 2.2GAPCh. 13 - Prob. 2.3GAPCh. 13 - Prob. 2.4GAPCh. 13 - Prob. 2.5GAPCh. 13 - Prob. 2.6GAPCh. 13 - Prob. 2.7GAPCh. 13 - Prob. 2.8GAPCh. 13 - Prob. 3.1GAPCh. 13 - Prob. 3.2GAPCh. 13 - Prob. 3.3GAPCh. 13 - Prob. 4.1GAPCh. 13 - Prob. 4.2GAPCh. 13 - Prob. 4.3GAPCh. 13 - Prob. 5.1GAPCh. 13 - Prob. 5.2GAPCh. 13 - Prob. 5.3GAPCh. 13 - Prob. 5.4GAPCh. 13 - Prob. 6.1GAPCh. 13 - Prob. 6.2GAPCh. 13 - Prob. 7GAPCh. 13 - Prob. 1.1GBPCh. 13 - Prob. 1.2GBPCh. 13 - Prob. 2.1GBPCh. 13 - Prob. 2.2GBPCh. 13 - Prob. 2.3GBPCh. 13 - Prob. 2.4GBPCh. 13 - Prob. 2.5GBPCh. 13 - Prob. 2.6GBPCh. 13 - Prob. 2.7GBPCh. 13 - Prob. 2.8GBPCh. 13 - Prob. 3.1GBPCh. 13 - Prob. 3.2GBPCh. 13 - Prob. 3.3GBPCh. 13 - Prob. 4.1GBPCh. 13 - Prob. 4.2GBPCh. 13 - Prob. 4.3GBPCh. 13 - Prob. 5.1GBPCh. 13 - Prob. 5.2GBPCh. 13 - Prob. 5.3GBPCh. 13 - Prob. 5.4GBPCh. 13 - Prob. 6.1GBPCh. 13 - Prob. 6.2GBPCh. 13 - Prob. 7GBP
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