Question

Perform a horizontal analysis on the following information providing both the dollar amount and percentage change.

2021 2020
Cash $670,000 $170,000
Accounts receivable 980,000 710,000
Inventory 710,000 520,000
Long-term assets 1,900,000 2,100,000
Total assets $4,260,000 $3,500,000

Required:
Calculate the perctanges for each amounts.

Answer 1

Answer and Explanation:

The computation of the percentage of each amount is as follows;

Particulars 2020 Change Percentage of change

a b (b ÷ a) × 100

Cash $170,000 $500,000 294%

Accounts Receivable $710,000 $270,000 38%

Inventory $520,000 $190,000 37%

Long Term Assets $2,100,000 -$200,000 -9.52%

Total Assets $3,500,000 $760,000 21.71%