Refer to the financial data for Bao Corporation in Problem 4-13.Using these financial statements, complete the following steps. In Problem 14-13, the financial statements for the Bao Corporation are given below.

Required
a. Prepare a horizontal analysis for the balance sheet.
b. Prepare a horizontal analysis for the income statement.
c. Comment on the results of any significant findings.
d. What types of issues does the company seem to be facing?
e. What suggestions do you have for the BaoCorporation?

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Bao Corporation Comparative Balance Sheets December 31,2012 and 2011 2012 2011 Assets Current assets: Cash $1,300 7,300 9,100 $1,900 Accounts receivable net Inventory Prepaid expenses 11,300 560 22,860 Total current assets Property and equipment: 17,950 86,000 48,600 134,600 $157,460 86,000 52,000 138,000 $155,950 an Buildings and equipment, net Total property and equipment Total assets Liabilities and Stockholder's Equity Current liabilities: Accounts payable Accrued expenses Notes payable, short term 17,600 1,620 S 21,000 4430 Total current liabilities Long-term liabilities: 19,760 25,650 Bonds payable Notes payable 5,300 34,400 59,460 5,300 35,000 65,950 Total liabilities Stockholders equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings 11,000 19,000 30,000 68,000 98,000 $157,460 11,000 19,000 30,000 60,000 90,000 $155,950 Total stockholder's equity Total liabilities and stockholder's equity Bao Corporation Comparative Income Statement For the Year Ended December 31,2012 and 2011 2012 2011 $130,000 67,000 63,000 111,000 Cost of goods sold Gross margin Operating expenses: 61,000 50,000 Selling expense 24,500 20,000 14 Administrative expenses Total operating expenses Income from operations Interest expense Income before taxes Less income taxes Net income 42,000 21,000 5,600 15,400 15,400 4,700 10,700 S 9,240