_____1. Which of the following are the most important stakeholders associated with sources of funding?

1. Management
2. Creditors and Investors
3. Government
4. Customers
5. Suppliers

______2. The year-over-year percentage of change in net income is an example of:

a. Horizontal analysis

b. Profitability analysis

c. Vertical analysis

d. Solvency analysis

3. See Exhibit A below showing analysis for Hershey Company MD&A portion of the Form 10-K.

Horizontal Analysis	12/31/18	12/31/17	Dollar Change	Percentage Change
Sales
Gross Profit

1. Complete this chart using values from the exhibit provided.

2. Which of the following is not addressed in the 2018 vs 2017 comparative analysis of sales provided in this report?

1. Overall, net sales increased year-over-year in 2018 vs 2017.
2. The recent acquisition of Amplify and Pirate Brands increased sales volumes in 2018 as compared to 2017.
3. An unfavorable impact from foreign currency exchange rates of 0.2%.
4. Decrease in promotional expenses resulted in favorable net price realization in 2018 as compared to 2017.

Accy 306 Quiz #5, page 2 of 2

3. Read the 2018 vs 2017 comparative analysis for Cost of Sales and Gross Margin in Exhibit A. If you needed further clarification, which of the following questions could you ask your accountant?
   1. Why did favorable supply chain productivity help offset higher costs in 2018 vs 2017?
   2. To confirm, higher transportation costs (freight and logistics) caused a decrease in gross margin in 2018 as compared to 2017?
   3. Why did additional plant costs due to new production lines and an unfavorable product mix contribute to a lower gross margin in 2018 as compared to 2017?
   4. All of the above questions could add clarification to your understanding.

_______4. A manufacturing firm, such as The Hershey Company, typically has a substantial long-term investment in which type of assets? See Exhibit B below.

1. Inventories
2. Prepaid Expenses
3. Accounts receivable
4. Property, plant and equipment