Question

Using these data from the comparative balance sheet of K. Leen Company, perform vertical analysis.

December 31, 2020 December 31, 2019
Amount Percentage Amount Percentage
Accounts Receivable $400,000 $400,000
Inventory 864,000 600,000
Total Assets 3,200,000 3,000,000

Answer 1

Answer and Explanation:

The vertical analysis is presented below:

Comparative Balance Sheet

Particulars Dec 31, 2020 Percentage Dec 31, 2019 Percentage

(a) [(a) ÷ $3200000] × 100 (b) [(b) ÷ $3000000] ×100

Accounts

receivables $400,000 12.5% $400,000 13.3%

Inventory $864,000 27.0% $600,000 20.0%

Total Assets $3,200,000 100.0% $3,000,000 100.0%