Horizontal and Vertical Analysis of Income Statement Data
Question Description
QUESTION #2
Here are the comparative income statements of Oriole Corporation.
ORIOLE CORPORATION Comparative Income Statement For the Years Ended December 31 | ||||
---|---|---|---|---|
2022 | 2021 | |||
Net sales | $640,400 | $584,700 | ||
Cost of goods sold | 463,600 | 439,100 | ||
Gross Profit | 176,800 | 145,600 | ||
Operating expenses | 79,100 | 48,700 | ||
Net income | $ 97,700 | $ 96,900 |
(a)
Prepare a horizontal analysis of the income statement data for Oriole Corporation, using 2021 as a base. (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 1 decimal place, e.g. 12.1%.)
ORIOLE CORPORATION Comparative Income Statement choose the accounting period For the Years Ended December 31For the Month Ended December 31December 31 | ||||||||
---|---|---|---|---|---|---|---|---|
Increase or (Decrease) During 2022 | ||||||||
2022 | 2021 | Amount | Percentage | |||||
Net sales | $640,400 | $584,700 | $enter a dollar amount | enter percentages rounded to 1 decimal place | % | |||
Cost of goods sold | 463,600 | 439,100 | enter a dollar amount | enter percentages rounded to 1 decimal place | % | |||
Gross Profit | 176,800 | 145,600 | enter a dollar amount | enter percentages rounded to 1 decimal place | % | |||
Operating expenses | 79,100 | 48,700 | enter a dollar amount | enter percentages rounded to 1 decimal place | % | |||
Net income | $ 97,700 | $ 96,900 | $enter a dollar amount | enter percentages rounded to 1 decimal place | % |
(b)
Prepare a vertical analysis of the income statement data for Oriole Corporation for both years. (Round percentages to 1 decimal place, e.g. 12.1%.)
ORIOLE CORPORATION Condensed Income Statements choose the accounting period For the Years Ended December 31For the Month Ended December 31December 31 | |||||||||
---|---|---|---|---|---|---|---|---|---|
2022 | 2021 | ||||||||
$ | Percent | $ | Percent | ||||||
Net sales | $640,400 | enter percentages rounded to 1 decimal place | % | $584,700 | enter percentages rounded to 1 decimal place | % | |||
Cost of goods sold | 463,600 | enter percentages rounded to 1 decimal place | % | 439,100 | enter percentages rounded to 1 decimal place | % | |||
Gross Profit | 176,800 | enter percentages rounded to 1 decimal place | % | 145,600 | enter percentages rounded to 1 decimal place | % | |||
Operating expenses | 79,100 | enter percentages rounded to 1 decimal place | % | 48,700 | enter percentages rounded to 1 decimal place | % | |||
Net income | $ 97,700 | enter percentages rounded to 1 decimal place | % | $ 96,900 | enter percentages rounded to 1 decimal place | % |
done
13 hours ago
QUESTION #3
Prepare a vertical analysis of the income statement data for Oriole Corporation for both years. (Round percentages to 1 decimal place, e.g. 12.1%.)
Target Corporation | Wal-Mart Stores, Inc. | ||||||
---|---|---|---|---|---|---|---|
Income Statement Data for Year | |||||||
Net sales | $66,100 | $411,000 | |||||
Cost of goods sold | 44,000 | 302,000 | |||||
Selling and administrative expenses | 15,400 | 81,000 | |||||
Interest expense | 660 | 2,100 | |||||
Other income (expense) | (70 | ) | (420 | ) | |||
Income tax expense | 1,400 | 7,300 | |||||
Net income | $ 4,570 | $ 18,180 | |||||
Balance Sheet Data (End of Year) | |||||||
Current assets | $17,000 | $49,000 | |||||
Noncurrent assets | 26,800 | 120,000 | |||||
Total assets | $43,800 | $169,000 | |||||
Current liabilities | $12,000 | $54,000 | |||||
Long-term debt | 17,600 | 45,000 | |||||
Total stockholders’ equity | 14,200 | 70,000 | |||||
Total liabilities and stockholders’ equity | $43,800 | $169,000 | |||||
Beginning-of-Year Balances | |||||||
Total assets | $43,000 | $162,000 | |||||
Total stockholders’ equity | 14,400 | 66,000 | |||||
Current liabilities | 10,600 | 57,000 | |||||
Total liabilities | 28,600 | 96,000 | |||||
Other Data | |||||||
Average net accounts receivable | $7,900 | $4,200 | |||||
Average inventory | 7,200 | 33,700 | |||||
Net cash provided by operating activities | 5,800 | 26,200 | |||||
Capital expenditures | 1,700 | 12,400 | |||||
Dividends | 460 | 3,600 |
For each company, compute the following ratios. (Round current ratio answers to 2 decimal places, e.g. 15.50, debt to assets ratio and free cash flow answers to 0 decimal places, e.g. 5,275 and all answers to 1 decimal place, e.g. 1.8 or 1.83%.)
Ratio | Target | Wal-Mart | ||||||
---|---|---|---|---|---|---|---|---|
(1) | Current ratio | enter the current ratio | :1 | enter the current ratio | :1 | |||
(2) | Accounts receivable turnover | enter accounts receivable turnover in times | times | enter accounts receivable turnover in times | times | |||
(3) | Average collection period | enter average collection period in days | days | enter average collection period in days | days | |||
(4) | Inventory turnover | enter inventory turnover in times | times | enter inventory turnover in times | times | |||
(5) | Days in inventory | enter days in inventory ratio | days | enter days in inventory ratio | days | |||
(6) | Profit margin | enter percentages | % | enter percentages | % | |||
(7) | Asset turnover | enter asset turnover in times | times | enter asset turnover in times | times | |||
(8) | Return on assets | enter percentages | % | enter percentages | % | |||
(9) | Return on common stockholders’ equity | enter percentages | % | enter percentages | % | |||
(10) | Debt to assets ratio | enter percentages | % | enter percentages | % | |||
(11) | Times interest earned | enter times interest earned | times | enter times interest earned | times | |||
(12) | Free cash flow | $enter a dollar amount | $enter a dollar amount |
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