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
20222021
Net sales$640,400$584,700
Cost of goods sold463,600439,100
Gross Profit176,800145,600
Operating expenses79,10048,700
Net income$ 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
20222021AmountPercentage
Net sales$640,400$584,700$enter a dollar amount enter percentages rounded to 1 decimal place%
Cost of goods sold463,600439,100enter a dollar amountenter percentages rounded to 1 decimal place%
Gross Profit176,800145,600enter a dollar amountenter percentages rounded to 1 decimal place%
Operating expenses79,10048,700enter a dollar amountenter 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
20222021
$Percent$Percent
Net sales$640,400enter percentages rounded to 1 decimal place%$584,700enter percentages rounded to 1 decimal place%
Cost of goods sold463,600enter percentages rounded to 1 decimal place%439,100enter percentages rounded to 1 decimal place%
Gross Profit176,800enter percentages rounded to 1 decimal place%145,600enter percentages rounded to 1 decimal place%
Operating expenses79,100enter percentages rounded to 1 decimal place%48,700enter percentages rounded to 1 decimal place%
Net income$ 97,700enter percentages rounded to 1 decimal place%$ 96,900enter 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$411,000
Cost of goods sold44,000302,000
Selling and administrative expenses15,40081,000
Interest expense6602,100
Other income (expense)(70)(420)
Income tax expense1,4007,300
Net income$ 4,570$ 18,180
Balance Sheet Data
(End of Year)
Current assets$17,000$49,000
Noncurrent assets26,800120,000
Total assets$43,800$169,000
Current liabilities$12,000$54,000
Long-term debt17,60045,000
Total stockholders’ equity14,20070,000
Total liabilities and stockholders’ equity$43,800$169,000
Beginning-of-Year Balances
Total assets$43,000$162,000
Total stockholders’ equity14,40066,000
Current liabilities10,60057,000
Total liabilities28,60096,000
Other Data
Average net accounts receivable$7,900$4,200
Average inventory7,20033,700
Net cash provided by operating activities5,80026,200
Capital expenditures1,70012,400
Dividends4603,600


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%.)

RatioTargetWal-Mart
(1)Current ratioenter the current ratio:1enter the current ratio:1
(2)Accounts receivable turnoverenter accounts receivable turnover in timestimesenter accounts receivable turnover in timestimes
(3)Average collection periodenter average collection period in daysdaysenter average collection period in daysdays
(4)Inventory turnoverenter inventory turnover in timestimesenter inventory turnover in timestimes
(5)Days in inventoryenter days in inventory ratiodaysenter days in inventory ratiodays
(6)Profit marginenter percentages%enter percentages%
(7)Asset turnoverenter asset turnover in timestimesenter asset turnover in timestimes
(8)Return on assetsenter percentages%enter percentages%
(9)Return on common stockholders’ equityenter percentages%enter percentages%
(10)Debt to assets ratioenter percentages%enter percentages%
(11)Times interest earnedenter times interest earnedtimesenter times interest earnedtimes
(12)Free cash flow$enter a dollar amount $enter a dollar amount 

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