Question

Vertical Analysis help!

Using the following data from the comparative balance sheet of Goody Company. December 31, 2017 December 31, 2016 Accounts receivable Inventory Total assets $418,320 816,720 2,490,000 $425,250 787,500 3,150,000 Illustrate vertical analysis. (Round percentages to 1 decimal place, e.g. 12.1%.) December 31, 2017 December 31, 2016 Goody Company Balance Sheets Amount Percentage Amount Percentage Accounts receivable $418,320 $816,720 $2,490,000 % $425,250 % $787,500 % $3,150,000 Inventory Total assets

Answer 1

Under vertical analysis;each item is represented as a % of total assets/Total liabilities and stockholders equity in the balance sheet.

	December 31,2017		December 31,2016
AR	418320	(418320/2,490,000)=16.8%	425250	(425250/3,150,000)=13.5%
Inventory	816720	(816720/2,490,000)=32.8%	787500	(787500/3,150,000)=25%
Total assets	2,490,000	100%	3,150,000	100%