Question

Question 6

The comparative balance sheet for the financial year ended June 30 for Great Road Trips is as follows:

Question 6 The comparative balance sheet for the financial year ended June 30 for Great Road Trips is as follows: Great Road Trips Ltd. Comparative Statements of Financial Position As at 30/06/2019 As at 30/06/2018 $ $ Current Assets Cash 90,000 85,000 Accounts Receivable 30,000 40,000 Less: Allowance for Bad Debts 3,900 2,400 Supplies 200 300 Prepaid Insurance 1,320 1,200 Total Current Assets 117,620 124,100 Non-current Assets Vehicles 60,000 40,000 Less: Accumulated Depreciation - Vehicles 10,000 4,000 Total Non-current Assets 50,000 36,000 TOTAL ASSETS 167,620 160,100 15,000 9,000 20,000 7,000 24,000 27,000 Current Liabilities Accounts Payable Unearned Revenue Total Current Liabilities Non-current Liabilities Long Term Loan Total Non-current Liabilities TOTAL LIABILITIES 25,000 5,000 25,000 49,000 5,000 32,000 Shareholders' Equity Contributed Capital Retained Earnings Total Shareholders' Equity 50,000 68,620 40,000 88,100 118,620 128,100 Total Liabilities & Shareholders' Equity 167,620 160,100

Answer 1

A.) Comparative Balance Sheet

Great Trip Roads Ltd.
Balance Sheet	2019	2018	Horizontal Analysis Increase or (Decrease) 2019 over 2018	Percent
Assets:
Current Assets
Cash	90,000	85,000	5,000	5.9%
Account Receivables (Net)	26,100	37,600	(11,500)	-30.6%
Supplies	200	300	(100)	-33.3%
Prepaid Insurance	1,320	1,200	120	10%
Total Current Assets	117,620	124,100	(6,480)	-5.2%
Non-Current Assets
Vehicles	50,000	36,000	14,000	38.9%
Total Assets	167,620	160,100	7,520	4.7%
Liabilities and Shareholder's Equity:
Current Liabilities
Account Payables	15,000	20,000	(5,000)	-25%
Unearned Revenue	9,000	7,000	2,000	28.6%
Total Current Liabilities	24,000	27,000	(3,000)	-11.1%
Non- Current Liabilities
Long-term Loan	25,000	5,000	20,000	400%
Total Liabilities	49,000	32,000	17,000	53.1%
Shareholder's Equity
Contributed Capital	50,000	40,000	10,000	25%
Retained Earnings	68,620	88,100	(19,480)	-22.1%
Total Shareholder's Equity	118,620	128,100	(9,480)	-7.4%
Total Liabilities and Shareholder's Equity	167,620	160,100	7,520	4.7%
Vertical Analysis	2019
Assets
Total Current Assets	117,620
Total Assets	167,620
Current Assets %	70.2%
In 2019 Current Assets are 70.2% of Total Assets

B.) Current Ratio (2019) = Current Assets / Current Liabilities

= 117,620 / 24,000

= 4.90