Chapter 14, Problem 14.2BYP

(a.1)

To determine

Horizontal Analysis: Horizontal analysis is prepared to make comparison between the financial statements to determine the changes in the financial statements for the previous year to the current year. The changes of the company are measured in dollars as well as in percentage.

Formula:

$\text{Percentage Change}=100\times \frac{\text{Later Period}\text{Amount}-\text{Base}\text{Period Amount}}{\text{Base Period Amount}}$

The percentage increase in net sales and net income from 2010 to 2011.

(2)

To determine

The percentage increase or decrease in the total assets and common stockholders’ equity.

3.

To determine

  The basic earnings per share and price earnings per share for 2011 and 2010.

b)

To determine

Conclusion about the companies