Vertical Analysis Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount. Formula: Vertical analysis percentage = ( Specific item Base amount ) × 100 This analysis is otherwise called as common-size statement. To prepare: Comparative income statement for the two-year period. Given info: Income statement for the two year period.

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Answer 1

Question

Chapter 14, Problem 2PB

To determine

Vertical Analysis

Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount.

Formula:

Vertical analysis percentage =(Specific itemBase amount)×100

This analysis is otherwise called as common-size statement.

To prepare: Comparative income statement for the two-year period.

Given info: Income statement for the two year period.

To determine

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.

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Selected comparative financial statements of Korbin Company follow. Sales KORBIN COMPANY Comparative Income Statements For Years Ended December 31 2021 2020 $ 512,008 $ 392,240 2019 $ 272,200 Cost of goods sold 308,229 245,542 174,208 Gross profit 203,779 146,698 97,992 Selling expenses 72,705 54,129 35,930 Administrative expenses 46,081 34,517 22,593 Total expenses 118,786 88,646 58,523 Income before taxes .84,993 58,052 39,469 Income tax expense 15,809 11,901 8,012 Net income $ 69,184 $ 46,151 $ 31,457 KORBIN COMPANY Comparative Balance Sheets Assets Current assets Long-term investments Plant assets, net Total assets Liabilities and Equity Current liabilities Common stock Other paid-in capital Retained earnings December 31 2021 2020 2019 $ 54,370 0 $ 36,390 600 $ 48,645 3,870 99,436 90,776 53,339 Total liabilities and equity $ 153,806 $ 127,766 $ 105,854 $ 22,456 $ 19,037 $ 18,524 68,000 68,000 50,000 8,500 8,500 5,556 54,850 32,229 31,774 $ 153,806 $ 127,766 $ 105,854

Answer 2

Question

Chapter 14, Problem 2PB

To determine

Vertical Analysis

Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount.

Formula:

Vertical analysis percentage =(Specific itemBase amount)×100

This analysis is otherwise called as common-size statement.

To prepare: Comparative income statement for the two-year period.

Given info: Income statement for the two year period.

To determine

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.

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Answer 3

Question

Chapter 14, Problem 2PB

To determine

Vertical Analysis

Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount.

Formula:

Vertical analysis percentage =(Specific itemBase amount)×100

This analysis is otherwise called as common-size statement.

To prepare: Comparative income statement for the two-year period.

Given info: Income statement for the two year period.

To determine

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.

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Answer 4

Question

Chapter 14, Problem 2PB

To determine

Vertical Analysis

Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount.

Formula:

Vertical analysis percentage =(Specific itemBase amount)×100

This analysis is otherwise called as common-size statement.

To prepare: Comparative income statement for the two-year period.

Given info: Income statement for the two year period.

To determine

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.

Expert Solution & Answer

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See solution

Answer 5

Chapter 14, Problem 2PB

To determine

Vertical Analysis

Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount.

Formula:

Vertical analysis percentage =(Specific itemBase amount)×100

This analysis is otherwise called as common-size statement.

To prepare: Comparative income statement for the two-year period.

Given info: Income statement for the two year period.

To determine

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.

Answer 6

Chapter 14, Problem 2PB

To determine

Vertical Analysis

Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount.

Formula:

Vertical analysis percentage =(Specific itemBase amount)×100

This analysis is otherwise called as common-size statement.

To prepare: Comparative income statement for the two-year period.

Given info: Income statement for the two year period.

Answer 7

Chapter 14, Problem 2PB

To determine

Vertical Analysis

Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount.

Formula:

Vertical analysis percentage =(Specific itemBase amount)×100

This analysis is otherwise called as common-size statement.

To prepare: Comparative income statement for the two-year period.

Given info: Income statement for the two year period.

Answer 8

To determine

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.

Answer 9

To determine

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.

Answer 10

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Answer 11

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Answer 12

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Answer 13

Ch. 14 - Prob. 1DQ Ch. 14 - What is the advantage of using comparative...Ch. 14 - Prob. 3DQ Ch. 14 - Prob. 4DQ Ch. 14 - Prob. 5DQ Ch. 14 - What do the following data, taken from a...Ch. 14 - Prob. 7DQ Ch. 14 - Prob. 8DQ Ch. 14 - Prob. 9DQ Ch. 14 - Prob. 10DQ

Requirement 2: To comment: Significant relationships revealed by the horizontal analysis.

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Chapter 14 Solutions

Requirement 2:

To comment: Significant relationships revealed by the horizontal analysis.