FINANCIAL ACCOUNTING: TOOLS WP ACCESS
FINANCIAL ACCOUNTING: TOOLS WP ACCESS
8th Edition
ISBN: 9781119230069
Author: Kimmel
Publisher: WILEY
Question
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Chapter 13, Problem 13.6E

a)

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:

Percentage Change=100×Later PeriodAmountBasePeriod AmountBase Period Amount

Vertical Analysis: Vertical analysis is prepared to analyze the relationship among various financial statements with a particular base amount. Use the following formula to calculate vertical analysis percentage:

Formula:

Vertical analysis percentage =(Specific itemBaseamount)×100

To prepare: Horizontal analysis of the income statement for Corporation D for the year 2017.

b)

To determine

To prepare: Vertical analysis for the income statement for Corporation D for 2017 and 2016.

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Horizontal Analysis Presented below are the Comprehensive statement of Financial Position and comparative income statement of Andy Lim Trading . Perform a Horizontal analysis showing the increase of decrease for the year 2017 in comparison to the year 2016.
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