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Describe and illustrate the use of vertical analysis in evaluating a company's performance and financial condition.The following data are taken from recent financial statements of

Describe and illustrate the use of vertical analysis in evaluating a company's performance and financial condition.The following data are taken from recent financial statements ofNike, Inc. (NKE)(in millions):

Year 2Year 1Revenues (sales)$32,376$30,601Operating income4,5024,175

  1. Determine the amount of change (in millions) and percent of change in operating income from Year 1 to Year 2. Round to one decimal place. (Horizontal Analysis) (Change/Year 1-base year)
  2. Determine the percentage relationship between operating income and sales for Year 2 and Year 1. Round to one decimal place. (Vertical Analysis) (Operating Income/Revenues)

Discussion:

  1. What conclusion can you draw from this analyses above?
  2. Do you think that Nike's 2018 "Just Do It" ad campaign was to boost sales or to take a political stance on a sensitive issue or both?Try to keep your comment on the accounting side versus any personal view you may possess, as I do not want anyone to be offended (please/thanks).Always keep it positive!
  3. Finally, right or wrong aside, there was a financial impact to that ad campaign.Did it strengthen sales or decline sales?I only want you to discuss any financial impact that you can find.Were the results good or bad?

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