The first part is a vertical and horizontal analysis of the income statement for wine depot. The second section is the vertical and horizontal analysis for the balance sheet of wine depot. The bottom part is the ratio analysis that needs to be completed.

Create a ratio analysis as of 12/31/16. Provide explanations/practice analyzing the various meanings of the results of your ratio analyses (i.e. compare to industry norms, drawing on your own backgrounds/findings, etc.) Wine Depot, Inc.
Income Statement
for the period ended		(Item/Sale)			(Item Sale)
		Vertical Analysis			Vertical Analysis			Horizontal Analysis
Particulars		15-Dec	% Sales		16-Dec	% Sales		% Change
Sales		$ 275,000.00	100.00%		$ 325,000.00	100.00%		18.18%
Less: Cost of Goods Sold		$ 115,000.00	41.82%		$ 195,000.00	60.00%		69.57%
Gross Margin		$ 160,000.00	58.18%		$ 130,000.00	40.00%		-18.75%
Expenses:
Advertising	$ 7,000.00		2.55%	$ 18,000.00		5.54%		157.14%
Marketing	$ 5,000.00		1.82%	$ 3,000.00		0.92%		-40.00%
Depreciation	$ 8,000.00		2.91%	$ 8,000.00		2.46%		0.00%
Interest	$ 4,000.00		1.45%	$ 1,500.00		0.46%		-62.50%
Salary	$ 50,000.00		18.18%	$ 85,000.00		26.15%		70.00%
Wages	$ 20,000.00		7.27%	$ 15,000.00		4.62%		-25.00%
Supplies	$ 4,600.00		1.67%	$ 7,000.00		2.15%		52.17%
Utilities	$ 7,400.00	$ 106,000.00	2.69%	$ 8,500.00	$ 146,000.00	2.62%		14.86%
Net Income before taxes		$ 54,000.00	19.64%		$ (16,000.00)	-4.92%		-129.63%
Income taxes		$ 6,000.00	2.18%		$ 4,000.00	1.23%		-33.33%
Net Income		$ 48,000.00	17.45%		$ (20,000.00)	-6.15%		-141.67%

Wine Depot, Inc.
Balance Sheet
as of
	$ 42,339.00		% Assets	$ 42,705.00		% Assets	% Change
Assets
Current Assets:
Cash	$ 5,000.00		5.05%	$ 7,000.00		7.00%	40.00%
Short-Term Investments	$ 2,000.00		2.02%	$ 3,500.00		3.50%	75.00%
Accounts Receivable	$ 6,000.00		6.06%	$ 8,500.00		8.50%	41.67%
Inventory	$ 6,500.00		6.57%	$ 9,200.00		9.20%	41.54%
Prepaid Expenses	$ 700.00		0.71%	$ 500.00		0.50%	-28.57%
Supplies	$ 1,800.00	$ 22,000.00	1.82%	$ 2,300.00	$ 31,000.00	2.30%	27.78%
Equipment	$ 85,000.00		85.86%	$ 85,000.00		85.00%	0.00%
Less: Accumulated Depreciation	$ 8,000.00	$ 77,000.00	8.08%	$ 16,000.00	$ 69,000.00	16.00%	100.00%
Total		$ 99,000.00	100.00%		$ 100,000.00	100.00%
Liabilities and Stockholders' Equity
Liabilities
Current Liabilities:
Accounts Payable	$ 16,000.00		16.16%	$ 43,500.00		43.50%	171.88%
Income Tax Payable	$ 6,000.00		6.06%	$ 1,000.00		1.00%	-83.33%
Notes Payable - Equipment	$ 9,000.00		9.09%	$ 8,000.00		8.00%	-11.11%
Notes Payable - Other	$ 18,000.00		18.18%	$ 15,000.00		15.00%	-16.67%
Payroll Liabilities	$ 2,000.00	$ 51,000.00	2.02%	$ 3,500.00	$ 71,000.00	3.50%	75.00%
Stockholders' Equity
Common Stock	$ 1,000.00		1.01%	$ 1,000.00		1.00%	0.00%
Retained Earnings	$ 47,000.00	$ 48,000.00	47.47%	$ 28,000.00	$ 29,000.00	28.00%	-40.43%
Total		$ 99,000.00			$ 100,000.00

Wine Depot, Inc.
Ratio Analysis
December 2016
Profitability
Return on owners' investment
Return on total investment
Profit margin
Gross margin
Liquidity
Current ratio
Quick ratio
Receivable turnover
Inventory turnover
Solvency
Debt-to-equity
Liability