Based on the information below prepare a horizontal analysis and vertical analys
ID: 2482817 • Letter: B
Question
Based on the information below prepare a horizontal analysis and vertical analysis.
Balance Sheet as of 201Y Assets Current Assets Cash Total Current A ssets $12,000 12,000 $9,000 9,000 Vehicle (net) Total Long Term Assets 9,000 9,600 9,000 9,600 Total Assets $21,000 $18,600 Liabilitie Current Liabilities: Accounts Payable Total Current Liabilities Total Liabilities $5,000 5,000 5,000 $4,600 4.600 4,600 Equity: Contributed Capital Retained Earnings Total Equity Total Liabilities & Equity 10,000 6,000 16,000 $21,000 10,000 4,000 14,000 $18.600Explanation / Answer
In Horizontal analysis, we calculate change and change % by comparing two year’s data.
Dec 31,201Y
Dec 31,201X
Change
% change
Assets
Cash
12000
9000
3000
33.33%
Total current assets
12000
9000
3000
33.33%
Vehicle
9000
9600
-600
-6.25%
Total long term asset
9000
9600
-600
-6.25%
Total Assets
21000
18600
2400
12.90%
Liabilities
Current Liabilities:
Accounts payable
5000
4600
400
8.70%
Total current liabilities
5000
4600
400
8.70%
Total Liabilities
5000
4600
400
8.70%
Equity:
Contributed capital
10000
10000
0
0.00%
Retained earnings
6000
4000
2000
50.00%
Total Equity
16000
14000
2000
14.29%
Total liabilities and equity
21000
18600
2400
12.90%
In vertical analysis, we compare each item with total assets and calculate proportion of total assets.
Dec 31,201Y
Dec 31,201X
201Y %
201X %
Assets
Cash
12000
9000
57.14%
48.39%
Total current assets
12000
9000
57.14%
48.39%
Vehicle
9000
9600
42.86%
51.61%
Total long term asset
9000
9600
42.86%
51.61%
Total Assets
21000
18600
100.00%
100.00%
Liabilities
Current Liabilities:
Accounts payable
5000
4600
23.81%
24.73%
Total current liabilities
5000
4600
23.81%
24.73%
Total Liabilities
5000
4600
23.81%
24.73%
Equity:
Contributed capital
10000
10000
47.62%
53.76%
Retained earnings
6000
4000
28.57%
21.51%
Total Equity
16000
14000
76.19%
75.27%
Total liabilities and equity
21000
18600
100.00%
100.00%
Dec 31,201Y
Dec 31,201X
Change
% change
Assets
Cash
12000
9000
3000
33.33%
Total current assets
12000
9000
3000
33.33%
Vehicle
9000
9600
-600
-6.25%
Total long term asset
9000
9600
-600
-6.25%
Total Assets
21000
18600
2400
12.90%
Liabilities
Current Liabilities:
Accounts payable
5000
4600
400
8.70%
Total current liabilities
5000
4600
400
8.70%
Total Liabilities
5000
4600
400
8.70%
Equity:
Contributed capital
10000
10000
0
0.00%
Retained earnings
6000
4000
2000
50.00%
Total Equity
16000
14000
2000
14.29%
Total liabilities and equity
21000
18600
2400
12.90%
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.