Question

The balance sheet of the Ancient Basin Hotel shows the value of the total assets (in thousands $) at

$1,712 (2016);

$1,127 (2015);

$1,273 (2014);

$1,975 (2013).

According to the trend percentage method of calculation, the total assets for 2016 are

Answer 1

Using the trend percentage method, the total assets for 2016 of the Ancient Basin Hotel can be calculated as $1,715 thousand.

Step-by-step explanation:

The trend percentage method is used to analyze changes in financial statements over time. In this case, we are analyzing the total assets of the Ancient Basin Hotel over four years: 2016, 2015, 2014, and 2013.

First, calculate the percentage change in assets for each year by dividing the change in assets by the previous year's assets and multiplying by 100. The percentage changes are as follows:

• 2016: (1,712 - 1,127) / 1,127 * 100 = 52.02%
• 2015: (1,127 - 1,273) / 1,273 * 100 = -11.47%
• 2014: (1,273 - 1,975) / 1,975 * 100 = -35.43%

To calculate the total assets for 2016 using the trend percentage method, we can multiply the 2015 assets by the percentage change in assets for 2016: 1,127 * (1 + 0.5202) = 1,715.04 thousand dollars. Rounded to the nearest thousand, the total assets for 2016 are $1,715 thousand.