ratio analysis
Sweet Michel
wrs_1.docxComputing trend analysis
Magic Oaks Realty's net revenue and net income for the following five-year period, using 2012 as the base year, follow:
2016 2015 2014 2013 2012
Net Revenue $ 1,310,000 $ 1,187,000 $1,110,000 $1,011,000 $ 1,045,000
Net Income 122,000 113,000 84,000 72,000 83,000
Requirements
1. Compute trend analysis for net revenue and net income. Round to the nearest full percent.
2. Which grew faster during the period, net revenue or net income?
Solution
1. Compute trend analysis for net revenue and net income. Round to the nearest full percent.
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Magic Oaks Realty |
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2016 |
2015 |
2014 |
2013 |
2012 |
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Net revenue |
$13,10,000 |
$11,87,000 |
$11,10,000 |
$10,11,000 |
$10,45,000 |
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Trend |
125% |
114% |
106% |
97% |
100% |
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Net Income |
$1,22,000 |
$1,13,000 |
$84,000 |
$72,000 |
$83,000 |
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Trend |
147% |
136% |
101% |
87% |
100% |
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2. Which grew faster during the period, net revenue or net income. |
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As indicated above the net income has shown more increase in 2016 and 2015, whereas net revenue has shown more increase in 2014 and 2013. |
Magic Oaks Realty_trend analysis
