SEE ATTACHED SPREADSHEET TO RECORD ANSWERS

Part A:Horizontal Analysis

Item

2015

2014

2013

Net Sales

$980 000

$900 000

$650 000

Cost of Goods Sold

700 000

640 000

480 000

Gross Profit

$280 000

$260 000

$170 000

Instructions:

1. Using horizontal analysis, calculate the trend percentages for net sales, cost of goods sold, and gross profit based on the data provided for Mason Corporation.
2. Explain whether the trends are favourable or unfavourable for each item.

Part B:Horizontal and Vertical Analysis

December 31, 2015

December 31, 2014

Accounts Receivable

$960 000

$600 000

Inventory

920 000

750 000

Total Assets

4 000 000

3 000 000

Instructions:

1. Using the above data taken from the comparative balance sheet of Hargrove Corporation, complete a horizontal analysis comparing 2015 to the base year 2014.
2. Using the above data from the comparative balance sheet of Hargrove Corporation, complete a vertical analysis that will compare accounts receivable and inventory to total assets for each year.
3. What conclusions can you draw?

Part C:Comparative Balance Sheet - Horizontal and Vertical Analysis

Assets

2014

2013

Current assets

$322

$280

Capital assets

678

520

Current liabilities

$180

$120

Long-term debt

200

160

Common shares

320

320

Retained earnings

300

200

Instructions:

1. Using horizontal analysis, show the percentage change for each balance sheet item of Martin Corporation, using 2013 as a base year.
2. Using vertical analysis, prepare a common size comparative balance sheet for Martin Corporation for each year.

Part A: Horizontal Analysis ooooooo ooooooo ooooooo Cost of Goods Sold 700 000 640 000 480 000 oooo ozoo ooo ooo ooo Instructions: 1. Using horizontal analysis, calculate the trend percentages for net sales, cost of goods sold, and gross prot based on the data provided for Mason Corporation. 2. Explain whether the trends are favourable or unfavourable for each item. Part B: Horizontal and Vertical Analysis l 1* ~ l' w ' . Accounts Receivable $960 000 $600 000 oooooo oooooo TUtal Assets 4 000 000 3 000 000 instructions: 1. Using the above data taken from the comparative balance sheet of Hargrove Corporation, complete a horizontal analysis comparing 2015 to the base year 2014. 2. Using the above data from the comparative balance sheet of Hargrove Corporation, complete a vertical analysis that will compare accounts receivable and inventory to total assets for each year. 3. What conclusions can you draw? Part c: Comparative Balance Sheet - Horizontal and Vertical Analysis Current assets Capital assets Current liabilities Long-tenn debt Common shares Retained earnings Instructions: 1. Using horizontal analysis, show the percentage ohange for each balance sheet item of Martin Corporation, using 2013 as a base year. 2. Using vertical analysis, prepare a common size comparative balance sheet for Martin Corporation for each year. Mason Corporation Comparative Income Statement December 31 Net Sales Cost of Goods Sold Gross Profit 2015 980,000 700,000 2014 900,000 640,000 Increase (Decrease) Increase (Decrease) during 2015 during 2014 2013 Amount % Amount % 650,000 480,000 Hargrove Corporation Comparative Balance Sheet December 31 Accounts Receivable Inventory Total Assets Increase (Decrease) during 2015 2014 Amount % 2015 960,000 920,000 600,000 750,000 4,000,000 3,000,000 Hargrove Corporation Comparative Balance Sheet December 31 Accounts Receivable Inventory Total Assets 2015 960,000 920,000 4,000,000 % 2014 600,000 750,000 3,000,000 % Martin Corporation Condensed Balance Sheet December 31 2015 Increase (Decrease) during 2015 2014 Amount % 322 $ 678 280 520 Liabilities and Shareholders' Equity Current liabilities Long-term debt 180 200 120 160 Common shares Retained earnings 320 300 320 200 Assets Current assets Capital assets $ Martin Corporation Condensed Balance Sheet December 31 2015 % Assets Current assets Capital assets Total assets Liabilities and Shareholders' Equity Current liabilities Long-term debt Total liabilities Common shares Retained earnings Total shareholders' equity Total liabilities and shareholders' equity $ 322 678 2014 $ 280 520 180 200 120 160 320 300 320 200 %