Q3. Prepare a) Horizontal analysis for the given Balance sheet of The Carpet shop b) Vertical Analysis for the given Income Statement of The Carpet shop [05] [05] THE CARPET SHOP Balmce Sheets December 31 2011 2010 2009 Cash Rs. 25,000 Rs. 20,000 Rs.18,000 Receivables (net) 50.000 45,000 48,000 Other current assets 90,000 95,000 64.000 Investments 75,000 70.000 45,000 Plant and equipment (net) 400,000 370.000 358,000 R:.640.000 Rs. 600.000 R: 533.000 Current liabilities Rs. 75,000 Rs. 80,000 Rs. 70,000 Long-term debt 80,000 85.000 50,000 Common stock, Rs. 10 par 340,000 310,000 300,000 Retained earnings 145,000 125,000 113,000 Rs. 640,000 Rs. 600,000 Rs. 533,000 THE CARPET SHOP Income Statement For the Year Ended December 31 Sales Less: Sales returns and allowances Net sales Cost of goods sold Gross profit Operating expenses (including income taxes) Net income 2011 2010 Rs. 740,000 Rs. 700,000 40.000 50,000 700,000 650,000 420,000 400,000 280,000 250,000 235,000 220,000 Rs. 45,000 Rs.30,000