1.

Horizontal Analysis

The comparative temporary investments and inventory balances of a company follow.

	Current Year	Previous Year
Accounts payable	$96,096	$72,800
Long-term debt	75,552	78,700

Based on this information, what is the amount and percentage of increase or decrease that would be shown on a balance sheet with horizontal analysis?

	Amount of Change	Increase/Decrease	Percentage
Accounts payable	$		%
Long-term debt	$		%

2.

Vertical Analysis

Income statement information for Einsworth Corporation follows:

Sales	$280,000
Cost of goods sold	86,800
Gross profit	193,200

Prepare a vertical analysis of the income statement for Einsworth Corporation. If required, round percentage answers to the nearest whole number.

Einsworth Corporation
Vertical Analysis of the Income Statement
	Amount	Percentage
Sales	$280,000	%
Cost of goods sold	86,800	%
Gross profit	$193,200	%

3.

Current Position Analysis

The following items are reported on a company's balance sheet:

Cash	$314,900
Marketable securities	246,000
Accounts receivable (net)	115,600
Inventory	307,500
Accounts payable	615,000

Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place.

a. Current ratio
b. Quick ratio