1 5 c D 1 M 1 2 3 4 Company A Balance Sheet 12/31/19 5 6 3. Current Ratio Horizontal Analysis Difference 2019 2018 4. Inventory Turnover $ 7 Assets 9 Cash 10 Accounts Receivable 11 Inventory 12 Equipment 13 Accum Deprec- Equipment 14 Total Assets 5. Accounts Receivable Turnover 38,000 30,000 27,000 60,000 (29,000) 126,000 $ 20,000 14,000 20,000 78,000 (24,000) $ 108,000 6. Profit Margin $ 17 18 19 * Liabilities & Stockholders Equity Accounts Payable $ 24,000 Income Tax Payable 7.000 Bonds Payable 27,000 Common Stock 18,000 21 Retained Earnings 50,000 Total Liabilities & SH Equity 126,000 23 1. Do a Horizontal analysis for above Balance Sheet $ 15,000 8,000 33,000 14,000 38,000 $ 108,000 2 25 2 26 29 Company A Income Statement Year 2019 Vertical Analysis 2018 Vertical Analysis 31 Sales Revenue Cost of goods Sold Gross Profit 242,000 125,000 67,000 210,000 160,000 50,000 33 35 Operating Expenses Income From Operations 24,000 43,000 20.000 30,000 37 Interest Expense Net Income Before Tax 3,000 40,000 2,000 28,000 29 40 41 Income Tax Expense Net Income $ 8,000 32,000 8,000 $ 20,000 43 ! 2. Do a vertical analysis for 2018 and 2019 above