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Vertical Analysis of Balance Sheets Required: 1. Prepare common size balance she

ID: 2470715 • Letter: V

Question

Vertical Analysis of Balance Sheets

Required:

1. Prepare common size balance sheets for vertical analysis. Enter your answers in percentage terms, rounded to two decimal places, and do not include the "%" sign with your answer. For example, "100.00" or "28.72". You do not need to include the actual dollar amounts shown above.

Winged Manufacturing

Consolidated Balance Sheets

December 31, 2013

December 31, 2012

Current assets:

Cash and cash equivalents

Correct 8 of Item 1

Correct 9 of Item 1

Short-term investments

Correct 11 of Item 1

Correct 12 of Item 1

Accounts receivable, net of allowance for doubtful accounts of $90,992 ($83,776 in 2012)

Correct 14 of Item 1

Correct 15 of Item 1

Inventories

Correct 17 of Item 1

Correct 18 of Item 1

Deferred tax assets

Correct 20 of Item 1

Correct 21 of Item 1

Other current assets

Correct 23 of Item 1

Correct 24 of Item 1

Total current assets

Correct 26 of Item 1

Correct 27 of Item 1

Property, plant, and equipment:

Land and buildings

Correct 30 of Item 1

Correct 31 of Item 1

Machinery and equipment

Correct 33 of Item 1

Correct 34 of Item 1

Office furniture and equipment

Correct 36 of Item 1

Correct 37 of Item 1

Leasehold improvements

Correct 39 of Item 1

Correct 40 of Item 1

Correct 41 of Item 1

Correct 42 of Item 1

Accumulated depreciation and amortization

Correct 44 of Item 1

Correct 45 of Item 1

Net property, plant, and equipment

Correct 47 of Item 1

Correct 48 of Item 1

Other assets

Correct 50 of Item 1

Correct 51 of Item 1

Total assets

Correct 53 of Item 1

Correct 54 of Item 1

Current liabilities:

Short-term borrowing

Correct 57 of Item 1

Correct 58 of Item 1

Accounts payable

Correct 60 of Item 1

Correct 61 of Item 1

Accrued compensation and employee benefits

Correct 63 of Item 1

Correct 64 of Item 1

Accrued marketing and distribution

Correct 66 of Item 1

Correct 67 of Item 1

Accrued restructuring costs

Correct 69 of Item 1

Correct 70 of Item 1

Other current liabilities

Correct 72 of Item 1

Correct 73 of Item 1

Total current liabilities

Correct 75 of Item 1

Correct 76 of Item 1

Long-term debt

Correct 78 of Item 1

Correct 79 of Item 1

Deferred tax liabilities

Correct 81 of Item 1

Correct 82 of Item 1

Total liabilities

Correct 84 of Item 1

Correct 85 of Item 1

Stockholders' equity:

Common stock, no par value: 320,000,000 shares authorized

Correct 88 of Item 1

Correct 89 of Item 1

Retained earnings

Correct 91 of Item 1

Correct 92 of Item 1

Accumulated translation adjustment

Correct 94 of Item 1

Correct 95 of Item 1

Total stockholders' equity

Correct 97 of Item 1

Correct 98 of Item 1

Total liabilities and stockholders' equity

Correct 100 of Item 1

Correct 101 of Item 1

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Solution

2. Indicate from what sources Winged appears to have secured the resources for its asset increase.

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1. Prepare common size balance sheets for vertical analysis. Enter your answers in percentage terms, rounded to two decimal places, and do not include the "%" sign with your answer. For example, "100.00" or "28.72". You do not need to include the actual dollar amounts shown above.

Winged Manufacturing

Consolidated Balance Sheets

December 31, 2013

December 31, 2012

Current assets:

Cash and cash equivalents

%

Correct 8 of Item 1

%

Correct 9 of Item 1

Short-term investments

%

Correct 11 of Item 1

%

Correct 12 of Item 1

Accounts receivable, net of allowance for doubtful accounts of $90,992 ($83,776 in 2012)

%

Correct 14 of Item 1

%

Correct 15 of Item 1

Inventories

%

Correct 17 of Item 1

%

Correct 18 of Item 1

Deferred tax assets

%

Correct 20 of Item 1

%

Correct 21 of Item 1

Other current assets

%

Correct 23 of Item 1

%

Correct 24 of Item 1

Total current assets

%

Correct 26 of Item 1

%

Correct 27 of Item 1

Property, plant, and equipment:

Land and buildings

%

Correct 30 of Item 1

%

Correct 31 of Item 1

Machinery and equipment

%

Correct 33 of Item 1

%

Correct 34 of Item 1

Office furniture and equipment

%

Correct 36 of Item 1

%

Correct 37 of Item 1

Leasehold improvements

%

Correct 39 of Item 1

%

Correct 40 of Item 1

%

Correct 41 of Item 1

%

Correct 42 of Item 1

Accumulated depreciation and amortization

%

Correct 44 of Item 1

%

Correct 45 of Item 1

Net property, plant, and equipment

%

Correct 47 of Item 1

%

Correct 48 of Item 1

Other assets

%

Correct 50 of Item 1

%

Correct 51 of Item 1

Total assets

%

Correct 53 of Item 1

%

Correct 54 of Item 1

Current liabilities:

Short-term borrowing

%

Correct 57 of Item 1

%

Correct 58 of Item 1

Accounts payable

%

Correct 60 of Item 1

%

Correct 61 of Item 1

Accrued compensation and employee benefits

%

Correct 63 of Item 1

%

Correct 64 of Item 1

Accrued marketing and distribution

%

Correct 66 of Item 1

%

Correct 67 of Item 1

Accrued restructuring costs

%

Correct 69 of Item 1

%

Correct 70 of Item 1

Other current liabilities

%

Correct 72 of Item 1

%

Correct 73 of Item 1

Total current liabilities

%

Correct 75 of Item 1

%

Correct 76 of Item 1

Long-term debt

%

Correct 78 of Item 1

%

Correct 79 of Item 1

Deferred tax liabilities

%

Correct 81 of Item 1

%

Correct 82 of Item 1

Total liabilities

%

Correct 84 of Item 1

%

Correct 85 of Item 1

Stockholders' equity:

Common stock, no par value: 320,000,000 shares authorized

%

Correct 88 of Item 1

%

Correct 89 of Item 1

Retained earnings

%

Correct 91 of Item 1

%

Correct 92 of Item 1

Accumulated translation adjustment

%

Correct 94 of Item 1

%

Correct 95 of Item 1

Total stockholders' equity

%

Correct 97 of Item 1

%

Correct 98 of Item 1

Total liabilities and stockholders' equity

%

Correct 100 of Item 1

%

Correct 101 of Item 1

Explanation / Answer

2) Issue of common stock and borrowing from Long term Debt.

ASSETS 2013 2012 Current Assets: $ $ $ $ Cash & Cash Equivalents 120488 2.27% 676413 13.08% Short Term Investments 54368 1.03% 215890 4.17% Accounts receivable, Net of allowance for doubtful accounts 1581347 29.82% 1381946 26.72% Inventories 1088434 20.53% 1506638 29.13% Deferred Tax Assets 293048 5.53% 268085 5.18% Other Current Assets 255767 4.82% 289383 5.60% Total Current Assets 4476452 84.42% 4338355 83.89% Property plant and Equipment Land and equipments 484592 9.14% 404688 7.83% Machinery & Equipment 572728 10.80% 578272 11.18% Office Furniture & Equipment 158160 2.98% 167905 3.25% Leasehold Improvements 236708 4.46% 261792 5.06% 1452188 27.39% 1412657 27.32% Accumulate Depreciation 785088 14.81% 753111 14.56% Net Property Plant and Equipment 667100 12.58% 659546 12.75% Other assets 159194 3.00% 173511 3.36% Total Assets 5302746 100.00% 5171412 100.00% LIABILITES AND STOCKHOLDERS' EQUITY Current Liabilites: Short Term Borrowings 292200 5.51% 823182 15.92% Accounts payable 881717 16.63% 742622 14.36% Accrued Compensation and employee benefits 136895 2.58% 144779 2.80% Accrued marketing and distribution 178294 3.36% 174547 3.38% Accrued Restructuring costs 58238 1.10% 307932 5.95% Other current liabilites 396961 7.49% 315023 6.09% Total Current Liabilites 1944305 36.67% 2508085 48.50% Long Term Debt 304472 5.74% 7117 0.14% Deferred tax liabilites 670668 12.65% 629832 12.18% Total Liabilites 2919445 55.06% 3145034 60.82% Stockholders' equity Common Stock, no par value 297929 5.62% 203613 3.94% Retained earnings 2096206 39.53% 1842600 35.63% Accumulated translation Adjustment 10834 0.20% 19835 0.38% Total stockholders' equity 2383301 44.94% 2026378 39.18% Total Liabilities and Stockholders' equity 5302746 100.00% 5171412 100.00%