Exercise 13-3 (Algo) Computing and analyzing trend percents LO P1 k Sales Cost of goods sold Accounts receivable 2021 $ 702,248 360,596 33,848 2020 2019 2018 $ 453,063 232,612 26,504 $368,344 190,905 25,305 2017 97,410 $254,030 $ 191,000 130,905 14,810 13,045 Compute trend percents for the above accounts, using 2017 as the base year. For each of the three acc situation as revealed by the trend percents appears to be favorable or unfavorable. Trend Percent for Net Sales: Numerator: Denominator: Analysis period net sales Base year net sales 2021: $ 1/ $ 2020: $ 1/ $ 2019: $ 1/ $ 2018: $ 1/ $ 2017: $ 1/$ Is the trend percent for Net Sales favorable or unfavorable? Trend percent 1= 100 % 1= 100 % 1= 100 % 1= 100 % 1= 100 % Favorable Trend Percent for Cost of Goods Sold: Numerator: Denominator: Analysis period cost of goods sold Base year cost of goods sold Trend percent 2021: $ 1= 100 % 2020: $ 2019. 1/ $ 1 1 = 100 % 100 0% Numerator: Trend Percent for Cost of Goods Sold: Analysis period cost of goods sold Denominator: Base year cost of goods sold = Trend percent 2021: $ 2020: $ 2019: $ 2018: $ 2017: $ 1/$ 1 = 100 % 1/ $ 1= 100 % 1 / $ 1= 100 % 1/ $ 1= 100 % 1/ $ 1= 100 % Is the trend percent for Cost of Goods Sold favorable or unfavorable? Unfavorable Trend Percent for Accounts Receivable: Numerator: Denominator: Analysis period accounts receivable Base year accounts receivable = Trend percent 2021: $ 1/ $ 1= 100 % 2020: $ 1/ $ 1= 100 % 2019: $ 1/ $ 1= 100 % 2018: $ 1/ $ 1= 100 % 2017: $ 1/ $ 1= 100 % Is the trend percent for Accounts Receivable favorable or unfavorable? Unfavorable