Scenario

Information from Halloran Companys Income Statement and Balance Sheets for the years 20132017 is presented.

Use these statements to calculate trend percentages for all components of both statements using 2013 as the base year. (I have already done this part):

Trend Analysis Income Statement

	2017	2016	2015	2014	2013
Sales	143	126	116	107	100
Costs of Goods Sold	166	137	120	107	100
Gross Profit	103	107	108	106	100
Operating Expenses	225	175	160	116	100
Net income	41	72	81	101	100

Trend Analysis Balance Sheet
	2017	2016	2015	2014	2013
Assets
Cash	88	89	94	95	100
Accounts Receivable (net)	154	162	146	113	100
Merchandise Inventory	196	146	129	110	100
Other Current Assets	129	114	52	124	100
Long-term Investments	0	0	0	100	100
Plant Assets (Net)	206	206	179	96	100
Total Assets	179	160	141	104	100
Liabilities and Equity
Current Liabilities	223	191	131	112	100
Long Term Liabilities	223	197	192	98	100
Common Stock	118	118	118	100	100
Other Paid-in Capital	158	147	147	100	100
Retained Earnings	195	164	126	114	100
Total Liabilities and Equity	179	160	127	104	100

Question:

2. Prepare a memo to the CEO of Halloran company summarizing your findings about the financial health of the company, using your calculations from above as evidence to support your conclusions.

HALLORAN COMPANY Comparative Income Statements For Years Ended December 31, 20172013 ($ thousands) Sales Cost of goods sold Gross profit Operating expenses Net income 2017 2016 2015 2014 2013 $ 1,271 $ 1,122 $ 1,028 $ 948 $ 890 $ 935 $ 774 $ 677 $ 602 $ 564 $ 336 $ 348 $ 351 $ 347 $ 326 $ 248 $ 192 $ 176 $ 128 $ 110 89 $ 156 $ 176 $ 219 $ 216 HALLORAN COMPANY Comparative Balance Sheets December 31, 20172013 2017 2016 2015 2014 2013 ($ thousands) Assets Cash $ 58 $ 59 $ 62 $ 63 $ 66 $ 368 $ 386 $ 350 $ 270 $ 239 $ 1,379 $ 1,023 $ 903 $ 774 $ 702 $ 27 $ 24 $ 11 $ 26 $ 21 $ - $ - $ - $ 110 $ 110 $ 1,515 $ 1,511 $ 1,314 $ 708 $ 734 $ 3,346 $ 3,002 $ 2,639 $ 1,950 $ 1,871 Accounts receivable, net Merchandise inventory Other current assets Long-term investments Plant assets, net Total assets Liabilities and Equity Current liabilities Long-term liabilities Common stock Other paid-in capital Retained earnings Total liabilities and equity $ 915 $ 782 $ 539 $ 461 $ 410 $ 971 $ 855 $ 834 $ 428 $ 435 $ 750 $ 750 $ 750 $ 638 $ 638 $ 202 $ 188 $ 188 $ 128 $ 128 $ 509 $ 428 $ 329 $ 297 $ 261 $ 3,346 $ 3,002 $ 2,639 $ 1,950 $ 1,871