Four-year comparative statements of comprehensive income and SFP for Firenza Products Inc. (FPI) are shown below. FPI has been undergoing an extensive restructuring in which the company has discontinued or sold several divisions in order to concentrate on its core business. As a result, the size of the company has decreased considerably.

Required:
1. Prepare a vertical analysis of both the SCI and the SFP.
2. Prepare a horizontal analysis of the SCI and SFP. Use 20X5 as the base year.
3. What conclusions about the company and its financial practices can you discern from your analysis?

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Statement of Comprehensive Income Years ended 31 December: Net sales Cost of products sold Depreciation and amortization Selling and administrative Operating earnings (loss) Interest expense Other income (expense) Earnings (loss) from continuing operations before income tax Income tax (recovery) Earnings (loss) from continuing operations Earnings (loss) from discontinued operations Net earnings and comprehensive income 20X8 $ 284.1 369.2 38.4 46.4 (169.9) (1.7) 32.6 (139.0) (46.9) (92.1) 390.7 $ 298.6 20X7 $ 949.6 793.5 94.8 49.0 12.3 (14.8) (0.5) (3.0) (2.6) (0.4) 119.9 $ 119.5 20X6 $1,388.8 1,045.9 88.7 53.4 200.8 (16.2) (5.3) 179.3 79.7 99.6 54.8 $ 154.4 20X5 $ 2,153.9 1,649.0 146.9 82.7 275.3 (40.5) 34.8 269.6 115.4 154.2 $ 154.2