Vertical Analysis of the Income statement and Balance sheet Common Size % ages 2003 ($) 2002 ($) 2001 ($) 2003 2002 2001 Sales 6,854,000 5,128,800 2,954,000 100% 100% 100% Cost of Goods Sold 5,825,900 4,308,192 2,422,280 85% B4% 82% Gross Profit 1,028, 100 820,608 531,720 15% 16% 18% Depreciation 120,000 116,960 18,900 2% 2% 1% Other Operating Expenses 685,400 512,880 236,320 10% 10% 8% Earnings Before Interest & Taxes 222,700 190,768 276,500 3% 4% 9% Interest 215,683 140,847 37,875 3% 3% 1% Earnings Before Taxes 49,921 238,625 0% 1% 8% Income Taxes 2,807 19.969 95,450 0% 0% 3% Net Income 4,210 29,953 143, 175 0% 1% 5% Units Sold 527,230 366,340 196,930 8% 7% 7% 2,017 2002$ 10,000 Cash Short term Investments Accounts Receivable Inventories Total Current Assets Property, Plant & Equipment Less: Accumulative Depreciation Total Assets Accounts Payable Line of Credit Current Portion of Long term Debit Total Current Liabilities Long term Debt Common Shares Retained Earnings Total Liabilities and Equity 2003 (5) 24,000 53,519 878,776 1,716,480 2,672.775 1,706,363 383,160 3,995,978 948,802 875,635 100,000 1.924,437 1,067 660 660,000 343,881 3,995,978 617,160 1,287 360 1,914,520 1,402.500 263,160 3,053,860 511,267 510,582 32,340 1,054,189 1,000,000 660,000 339,671 3,053,860 2001 (5) 9,000 295,340 301,200 518,460 1,124,000 691,000 146,200 1,668,800 145,600 200,000 30,050 375,650 323,432 660,000 309,718 1,668,800 Common Size % ages 2003 2002 2001 570% 33% 6% 1271% 0% 206% 20874% 2060% 210% 40771% 4298% 362% 63486% 6392% 785% 40531% 4682% 483% -9101% -879% -102% 100% 100% 100% 55% 40% 28% 51% 40% 39% 6% 3% 6% 112% 82% 72% 62% 78% 62% 38% 51% 127% 20% 26% 60% 100% 100% 100% Horizontal Trend Analysis: Sales Cost of Goods Sold Gross Profit Depreciation Other Operating Expenses Earnings Before Interest & Taxes Interest Earnings Before Taxes Income Taxes Net Income Units Sold 2003 (%) 70% 262% 239% 652% 438% 333% 512% 330% 100% 111% 239% 2002 %) 2001% 58% 29% 180% 100% 183% 100% 351% 100% 255% 100% 108% 100% 281% 100% 309% 100% 100% 100% 110% 100%) 183% 100% Questions; 1) Given the data above Identify KEY ISSUES in this case (at least 3 key issues) for each issue make sure y identify how you would measure it? 2) Any recommendations or solutions for improvement? Vertical Analysis of the Income statement and Balance sheet Common Size % ages 2003 ($) 2002 ($) 2001 ($) 2003 2002 2001 Sales 6,854,000 5,128,800 2,954,000 100% 100% 100% Cost of Goods Sold 5,825,900 4,308,192 2,422,280 85% B4% 82% Gross Profit 1,028, 100 820,608 531,720 15% 16% 18% Depreciation 120,000 116,960 18,900 2% 2% 1% Other Operating Expenses 685,400 512,880 236,320 10% 10% 8% Earnings Before Interest & Taxes 222,700 190,768 276,500 3% 4% 9% Interest 215,683 140,847 37,875 3% 3% 1% Earnings Before Taxes 49,921 238,625 0% 1% 8% Income Taxes 2,807 19.969 95,450 0% 0% 3% Net Income 4,210 29,953 143, 175 0% 1% 5% Units Sold 527,230 366,340 196,930 8% 7% 7% 2,017 2002$ 10,000 Cash Short term Investments Accounts Receivable Inventories Total Current Assets Property, Plant & Equipment Less: Accumulative Depreciation Total Assets Accounts Payable Line of Credit Current Portion of Long term Debit Total Current Liabilities Long term Debt Common Shares Retained Earnings Total Liabilities and Equity 2003 (5) 24,000 53,519 878,776 1,716,480 2,672.775 1,706,363 383,160 3,995,978 948,802 875,635 100,000 1.924,437 1,067 660 660,000 343,881 3,995,978 617,160 1,287 360 1,914,520 1,402.500 263,160 3,053,860 511,267 510,582 32,340 1,054,189 1,000,000 660,000 339,671 3,053,860 2001 (5) 9,000 295,340 301,200 518,460 1,124,000 691,000 146,200 1,668,800 145,600 200,000 30,050 375,650 323,432 660,000 309,718 1,668,800 Common Size % ages 2003 2002 2001 570% 33% 6% 1271% 0% 206% 20874% 2060% 210% 40771% 4298% 362% 63486% 6392% 785% 40531% 4682% 483% -9101% -879% -102% 100% 100% 100% 55% 40% 28% 51% 40% 39% 6% 3% 6% 112% 82% 72% 62% 78% 62% 38% 51% 127% 20% 26% 60% 100% 100% 100% Horizontal Trend Analysis: Sales Cost of Goods Sold Gross Profit Depreciation Other Operating Expenses Earnings Before Interest & Taxes Interest Earnings Before Taxes Income Taxes Net Income Units Sold 2003 (%) 70% 262% 239% 652% 438% 333% 512% 330% 100% 111% 239% 2002 %) 2001% 58% 29% 180% 100% 183% 100% 351% 100% 255% 100% 108% 100% 281% 100% 309% 100% 100% 100% 110% 100%) 183% 100% Questions; 1) Given the data above Identify KEY ISSUES in this case (at least 3 key issues) for each issue make sure y identify how you would measure it? 2) Any recommendations or solutions for improvement