Question : 21) Given the following data: Current liabilities $450,000 Noncurrent : 1230079

 

21) Given the following data:

 

Current liabilities

$450,000

Noncurrent liabilities

650,000

Stockholders’ equity

500,000

 

In vertical analysis, current liabilities would be expressed as:

A) 356%.

B) 90%.

C) 111%.

D) 28%.

22) In performing a vertical analysis, the base for sales returns and allowances is:

A) sales discounts.

B) sales.

C) gross profit.

D) net sales.

23) In performing a vertical analysis, the base for cost of goods sold is:

A) net sales.

B) total revenues.

C) total expenses.

D) gross profit.

24) Given the following data:

 

Cash

$225,000

Current assets

970,000

Total assets

2,105,000

 

In a vertical analysis, cash would be expressed as:

A) 935%.

B) 217%.

C) 46%.

D) 11%.

25) If a balance sheet is subjected to vertical analysis which shows that current assets (using total assets as the base) have increased from 42% to 56%, this would always mean that:

A) current assets have increased as a percentage of total assets.

B) the dollar amount of total assets has increased.

C) the dollar amount of total assets has decreased.

D) the dollar amount of current assets has increased.

26) Given the following data:

 

Net sales

200,000

Cost of goods sold

120,000

Gross profit

80,000

 

In a vertical analysis, cost of goods sold would be expressed as:

A) 166%.

B) 40%.

C) 60%.

D) 250%.

27) Given the following data:

 

Net sales

200,000

Cost of goods sold

120,000

Gross profit

$80,000

Operating expenses

44,000

Net income

36,000

 

In a vertical analysis, net income would be expressed as:

A) 18%.

B) 45%.

C) 30%.

D) 82%.

28) If the assets shown on a balance sheet are subjected to vertical analysis (using total assets as the base), an increase in the figure for current assets from 56% to 60% would always mean that:

A) the dollar amount of noncurrent assets has increased.

B) the dollar amount of total assets has increased.

C) total current assets have increased as a percentage of total assets.

D) the dollar amount of current assets has increased.

29) Prepare a vertical analysis for Winkler Corporation using the information shown below (round percentages to the nearest one-tenth percent):

 

 

2012

Sales

$450,000

Cost of goods sold

200,000

Gross profit

250,000

Operating expenses

118,000

Net income

132,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30) Prepare a vertical analysis for Crestwood Corporation’s balance sheet to determine the component percentages of its assets, liabilities, and stockholders’ equity. Round percentages to the nearest one-tenth percent.

31) Prepare a vertical analysis for Westwood Corporation by completing the right column of the following balance sheet with the appropriate percentages. Round percentages to the nearest one-tenth percent.

 

 

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