Barnett Publishing Inc., reported the following current asset data (in $000s) in

Question

Barnett Publishing Inc., reported the following current asset data (in $000s) in its 2014 annual report.

Prepare a trend analysis of Barnett’s current assets. (Round answers to 1 decimal place, e.g. 16.4%.)

Current Assets 2014 2013 2012 2011 Cash and equivalents $4,444,296 $4,663,753 $5,428,506 $4,973,760 Short-term investments 1,292,289 1,288,357 1,332,340 1,260,945 Merchandise inventory 280,824 72,422 57,953 24,030 Accounts receivable 825,472 830,484 838,279 780,579 Prepaid expenses and other 371,559 384,100 379,547 341,427

Explanation / Answer

Solution:

Trend analysis of Barnett’s current assets

Current Assets

2014

2013

2012

2011

2014

2013

2012

2011

Cash and equivalents

$4,444,296

$4,663,753

$5,428,506

$4,973,760

89.4 %

93.8%

109.1%

100 %

Short-term investments

1,292,289

1,288,357

1,332,340

1,260,945

102.5 %

102.2 %

105.7%

100 %

Merchandise inventory

280,824

72,422

57,953

24,030

1168.6 %

301.4 %

241.2%

100 %

Accounts receivable

825,472

830,484

838,279

780,579

105.8 %

106.4 %

107.4 %

100 %

Prepaid expenses and other

371,559

384,100

379,547

341,427

108.8 %

112.5 %

111.2 %

100 %

Note: As base year is not given, 2011 is taken as base year. All the values of rest of the years are converted into percentage on the basis of 2011 (base year). So, the percentage of all the values of 2011 is 100%.

Trend Percentage = Current Year / Base Year X 100

Working Note (WN):

(1) Cash and equivalents =

2014=$4,444,296 / $4,973,760 X100= 89.4 %

2013=$4,663,753/ $4,973,760 X100= 93.8%

2012=$5,428,506/ $4,973,760 X100= 109.1%

2011=$4,973,760 / $4,973,760 X100= 100%

(2) Short-term investments=

2014=$1,292,289/ $ 1,260,945 X100= 102.5 %

2013=$1,288,357 / $ 1,260,945X100= 102.2 %

2012=$1,332,340/ $ 1,260,945X100= 105.7%

2011=$1,260,945 / $ 1,260,945X100= 100%

(3) Merchandise inventory =

2014=$280,824 / $ 24,030X100= 1168.6 %

2013=$72,422 / $ 24,030 X100= 301.4 %

2012=$57,953 / $ 24,030 X100= 241.2%

2011=$24,030 / $ 24,030 X100= 100%

(4) Accounts receivable =

2014=$ 825,472 / $ 780,579 X100= 105.8 %

2013=$ 830,484 / $ 780,579 X100= 106.4 %

2012=$ 838,279 / $ 780,579 X100= 107.4 %

2011=$ 780,579 / $ 780,579 X100= 100%

(5) Prepaid expenses and other=

2014=$ 371,559 / $ 341,427 X100= 108.8 %

2013=$ 384,100 / $ 341,427 X100= 112.5 %

2012=$ 379,547/ $ 341,427 X100= 111.2 %

2011=$ 341,427 / $ 341,427 X100= 100 %

Current Assets

2014

2013

2012

2011

2014

2013

2012

2011

Cash and equivalents

$4,444,296

$4,663,753

$5,428,506

$4,973,760

89.4 %

93.8%

109.1%

100 %

Short-term investments

1,292,289

1,288,357

1,332,340

1,260,945

102.5 %

102.2 %

105.7%

100 %

Merchandise inventory

280,824

72,422

57,953

24,030

1168.6 %

301.4 %

241.2%

100 %

Accounts receivable

825,472

830,484

838,279

780,579

105.8 %

106.4 %

107.4 %

100 %

Prepaid expenses and other

371,559

384,100

379,547

341,427

108.8 %

112.5 %

111.2 %

100 %

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