Exercise 14-1 Condensed data from the comparative statement of financial positio

Question

Exercise 14-1 Condensed data from the comparative statement of financial position of Ridgewood Inc. follow 2018 2016 Current assets Non-current assets Current liabilities 2017 $119,000 $111,000 $97,000 396,000 329,000 303,000 109,000 101,000 96,000 Non-current liabilities 90,000 110,000 121,000 109,000 99,000 99,000 207,000 130,000 84,000 Common shares Retained earnings Using horizontal analysis, calculate the percentage of a base-year amount, using 2016 as the base year. (Round answers to 1 decimal place, e.g. 15.2%.,) RIDGEWOOD INC. Horizontal Analysis of Statement of Financial Position (% of base-year amount) 2018 2017 2016 Current assets Non-current assets Current liabilities Non-current liabilities Common shares Retained earnings

Explanation / Answer

HORIZONTAL ANALYSIS OF STATEMENT OF FINANCIAL POSITION 2018 2017 2016 Current Assets 122.68% 114.43% 100% Non-Current Assets 130.69% 108.58% 100% Current Lliabilties 113.54% 105.21% 100% Non-Current Lliabilities 74.38% 90.91% 100% Common Shares 110.10% 100% 100% Retained earnings 246.43% 154.76% 100% HORIZONTAL ANALYSIS OF STATEMENT OF FINANCIAL POSITION 2018 Increase/ % 2017 Increase/ % 2016 Decrease Decrease Assets: Current Assets 119000 22000 22.68% 111000 13000 13.40% 97000 Non-Current Assets 396000 93000 30.69% 329000 26000 8.58% 303000 Total Assets 515000 115000 28.75% 440000 40000 10% 400000 Liabilities and Stockholder's equity Liabilities: Current liabilities 109000 13000 13.54% 101000 5000 5.21% 96000 Non-Current liabilities 90000 -31000 -2.56% 110000 -11000 -9.09% 121000 Total liabilities 199000 -18000 -8.30% 211000 -6000 -2.75% 217000 Shareholder's equity: Common Shares 109000 10000 10.10% 99000 0 0 99000 Retained earnings 207000 123000 146.43% 130000 46000 54.76% 84000 Total Shareholder's equity 316000 133000 72.68% 229000 46000 25.14% 183000 Total liabilities and Shareholder's equity 515000 115000 28.75% 440000 40000 10% 400000

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