ABC CompanyComparative Statement of Comprehensive Income(In Thousand Pesos)Horizontal Analysis 20122011Increase (Decrease)% ChangeSalesP 240.00P 200.00 Less: Cost of Sales182.00140.00 Gross Profit P 58.00 P 60.00 Less: Operating Expenses SellingP 17.00P 18.00 General and Administrative11.8014.00 Total Operating Expenses P 28.80 P 32.00 Net Operating Income P29.20 P28.00 Add: Other Income & Expenses Interest IncomeP7.50P4.80 Interest Expense(7.40)(9.50) Net IncomeP29.30======P23.30====== ABC CompanyComparative Statement of Comprehensive IncomeVertical Analysis 2012%2011%SalesP240.00 P200.00 Less: Cost of Sales182.00 140.00 Gross Profit P58.00 P60.00 Less: Operating Expenses SellingP17.00 P18.00 General and Administrative11.80 14.00 Total Operating Expenses P28.80 P32.00 Net Operating Income P29.20 P28.00 Add: Other Income & Expenses Interest IncomeP7.50 P4.80 Interest Expense(7.40) (9.50) Net IncomeP29.30====== P23.30====== Financial Ratios: 2011 and 2012Liquidity StatusCurrent RatiosQuick Asset RatiosEfficiency StatusAsset TurnoverFixed Asset TurnoverInventory TurnoverDays in InventoryAccounts Receivable TurnoverDays in ReceivableProfitability Status:Gross Profit margin RatioOperating Income RatioNet Profit RatioReturn on AssetsReturn on Equity ABC CompanyComparative Statement of Comprehensive Income(In Thousand Pesos)Horizontal Analysis2012% Change2011Increase(Decrease)P 240.00P 200.00140.00SalesLess: Cost of Sales182.00Gross ProfitLess: Operating ExpensesSellingP 58.00P 60.00P 17.0011.80P 18.00General and Administrative14.00Total Operating ExpensesP 28.80Р 32.00Net Operating IncomeAdd: Other Income & ExpensesP29.20P28.00Interest IncomeP7.50P4.80(9.50)Interest ExpenseNet Income(7.40)P29.30P23.30ABC CompanyComparative Statement of Comprehensive IncomeVertical Analysis2012%2011%SalesP240.00P200.00Less: Cost of Sales182.00140.00Gross ProfitP58.00P60.00Less: Operating ExpensesSellingGeneral and AdministrativeP17.00P18.0011.8014.00Total Operating ExpensesP28.80P32.00Net Operating IncomeAdd: Other Income & ExpensesInterest IncomeP29.20P28.00P7.50P4.80Interest ExpenseNet Income(7.40)P29.30(9.50)P23.30Financial Ratios: 2011 and 20121. Liquidity Statusa. Current Ratiosb. Quick Asset Ratios2. Efficiency StatusAsset Turnoverb. Fixed Asset Turnovera.c. Inventory Turnoverd. Days in İnventorye. Accounts Receivable Tumoverf. Days in Receivable3. Profitability Status:a. Gross Profit margin Ratiob. Operating Income Ratioc. Net Profit Ratiod. Return on AssetsReturn on Equitye.

Note: The ratios cann't be calculated as the data related to the financial position (Balance Sheet)…

ABC Company Comparative Statement of Comprehensive Income (In Thousand Pesos) Horizontal Analysis 2012 2011 Increase (Decrease) % Change Sales P 240.00 P 200.00 Less: Cost of Sales 182.00 140.00 Gross Profit P 58.00 P 60.00 Less: Operating Expenses Selling P 17.00 P 18.00 General and Administrative 11.80 14.00 Total Operating Expenses P 28.80 P 32.00 Net Operating Income P29.20 P28.00 Add: Other Income & Expenses Interest Income P7.50 P4.80 Interest Expense (7.40) (9.50) Net Income P29.30 ====== P23.30 ====== ABC Company Comparative Statement of Comprehensive Income Vertical Analysis 2012 % 2011 % Sales P240.00 P200.00 Less: Cost of Sales 182.00 140.00 Gross Profit P58.00 P60.00 Less: Operating Expenses Selling P17.00 P18.00 General and Administrative 11.80 14.00 Total Operating Expenses P28.80 P32.00 Net Operating Income P29.20 P28.00 Add: Other Income & Expenses Interest Income P7.50 P4.80 Interest Expense (7.40) (9.50) Net Income P29.30 ====== P23.30 ======

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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ABC Company

Comparative Statement of Comprehensive Income

(In Thousand Pesos)

Horizontal Analysis

	2012	2011	Increase (Decrease)	% Change
Sales	P 240.00	P 200.00
Less: Cost of Sales	182.00	140.00
Gross Profit	P 58.00	P 60.00
Less: Operating Expenses
Selling	P 17.00	P 18.00
General and Administrative	11.80	14.00
Total Operating Expenses	P 28.80	P 32.00
Net Operating Income	P29.20	P28.00
Add: Other Income & Expenses
Interest Income	P7.50	P4.80
Interest Expense	(7.40)	(9.50)
Net Income	P29.30 ======	P23.30 ======

ABC Company

Comparative Statement of Comprehensive Income

Vertical Analysis

	2012	%	2011	%
Sales	P240.00		P200.00
Less: Cost of Sales	182.00		140.00
Gross Profit	P58.00		P60.00
Less: Operating Expenses
Selling	P17.00		P18.00
General and Administrative	11.80		14.00
Total Operating Expenses	P28.80		P32.00
Net Operating Income	P29.20		P28.00
Add: Other Income & Expenses
Interest Income	P7.50		P4.80
Interest Expense	(7.40)		(9.50)
Net Income	P29.30 ======		P23.30 ======

Financial Ratios: 2011 and 2012

Liquidity Status
1. Current Ratios
2. Quick Asset Ratios
Efficiency Status
1. Asset Turnover
2. Fixed Asset Turnover
3. Inventory Turnover
4. Days in Inventory
5. Accounts Receivable Turnover
6. Days in Receivable
Profitability Status:
1. Gross Profit margin Ratio
2. Operating Income Ratio
3. Net Profit Ratio
4. Return on Assets
5. Return on Equity

ABC Company
Comparative Statement of Comprehensive Income
(In Thousand Pesos)
Horizontal Analysis
2012
% Change
2011
Increase
(Decrease)
P 240.00
P 200.00
140.00
Sales
Less: Cost of Sales
182.00
Gross Profit
Less: Operating Expenses
Selling
P 58.00
P 60.00
P 17.00
11.80
P 18.00
General and Administrative
14.00
Total Operating Expenses
P 28.80
Р 32.00
Net Operating Income
Add: Other Income & Expenses
P29.20
P28.00
Interest Income
P7.50
P4.80
(9.50)
Interest Expense
Net Income
(7.40)
P29.30
P23.30
ABC Company
Comparative Statement of Comprehensive Income
Vertical Analysis
2012
%
2011
%
Sales
P240.00
P200.00
Less: Cost of Sales
182.00
140.00
Gross Profit
P58.00
P60.00
Less: Operating Expenses
Selling
General and Administrative
P17.00
P18.00
11.80
14.00
Total Operating Expenses
P28.80
P32.00
Net Operating Income
Add: Other Income & Expenses
Interest Income
P29.20
P28.00
P7.50
P4.80
Interest Expense
Net Income
(7.40)
P29.30
(9.50)
P23.30
Financial Ratios: 2011 and 2012
1. Liquidity Status
a. Current Ratios
b. Quick Asset Ratios
2. Efficiency Status
Asset Turnover
b. Fixed Asset Turnover
a.
c. Inventory Turnover
d. Days in İnventory
e. Accounts Receivable Tumover
f. Days in Receivable
3. Profitability Status:
a. Gross Profit margin Ratio
b. Operating Income Ratio
c. Net Profit Ratio
d. Return on Assets
Return on Equity
e.

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