Question

Using horizontal analysis, perpare a Comparative Balance Sheet.

Robust Robots, Inc. Comparative Balance Sheet December 31, 2019 and 2018 2019 2018 Assets Current Assets: Cash Accounts Receivable, net Merchandise Inventory Supplies Prepaid Insurance Total Current Assets $ $ $ $ $ $ 65,000 150,000 135,000 9,700 30,000 389,700 $ $ $ $ $ $ 80,000 100,000 70,000 500 10,000 260,500 Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation - Equipment Total Property, plant, and Equipment Total Assets $ $ $ $ 500,000 (80,000) 420,000 809,700 $ $ $ $ 240,000 (90,000) 150,000 410,500 4 Page

Answer 1

​​​​​​SoIution:

In a comparative balance sheet, each item of current year is compared with the previous year values to find out increase or decrease in its value, than percentage change is calculated taking the previous year as base value.

For example : Changes in Cash is calculated as 65,000-80,000=(-15,000). Its percentage is calculated as =(-15000/80000)*100 =-18.75%.

Similarly all values should be calculated .

C D E 2019 Change Comparative Balance Sheet 2018 Items Assets 5 Current Assets: Cash 80000 7 Accounts Receivable, net 100000 8 Merchandise inventory 70000 9 Supplies 500 10 Prepaid insurance 10000 11 Total current assets 260500 12 Property, plant and Equipment: 13 Equipment 240000 14 Less: Accumulated Depreciation Equipment -90000 Total Property, Plant and Equipment 150000 16 Total Assets 410500 65000 150000 135000 9700 30000 389700 - 15000 50000 65000 9200 20000 129200 -18.75 50.00 92.86 1840.00 200.00 49.60 15 500000 -80000 420000 809700 260000 10000 270000 399200 108.33 -11.11 180.00 97.25 17 40000 50000 30000 10000 130000 150000 40000 40000 10000 240000 110000 -10000 10000 275.00 -20.00 33.33 0.00 84.62 0 110000 18 Liabilities and Stockholders Equity 19 Current Liabilities 20 Accounts payable 21 Unearned Revenue 22 Salaries Payable 23 Federal Income tax payable 24 Total current liabilities 25 Long term Liabilities: 26 Note payable 27 Total long term liabilities Total Liabilities 29 Stock holders Equity 30 Common stock, $10 par 31 Paid-in capital in Excess of par 32 Retained earnings Total Stockholders' Equity Total Liabilities and Stickholders' Equity 130000 130000 370000 130000 130000 240000 28 130000 184.62 100000 70.00 180500 280500 410500 170000 43700 226000 439700 809700 70000 43700 45500 159200 399200 25.21 56.76 97.25