(1) Financial information for Nealon Inc. is presented below.

December 31, 2017 December 31, 2016

Current assets $140,000 $110,000

Plant assets (net)440,000 360,000

Current liabilities95,000 75,000

Long-term liabilities165,000 100,000

Common stock, $1 par 180,000 120,000

Retained earnings140,000 175,000

Instructions

(a) Prepare a schedule showing a horizontal analysis for 2017 using 2016 as the base year.7 points

(b) What is the primary use of horizontal analysis? 3 points

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(2) Operating data for Poll Corporation are presented below.

2017 2016

Net sales $900,000$700,000

Cost of goods sold 570,000450,000

Selling expenses 140,00090,000

Administrative expenses 80,00060,000

Income tax expense 33,00030,000

Net income 77,00070,000

Instructions

(a) Prepare a schedule showing a vertical analysis for 2017 and 2016.