Accounting Homework

acc_600_assignments_week_five.docx

ACC 600: Accounting and Finance for Managers

Assignments: Week Five

Exercise 1

Performing horizontal analysis—income statement

Data for McCormick Designs, Inc. follow:

Instructions

1. Prepare a horizontal analysis of the comparative income statement of McCormick Designs, Inc. Round percentage changes to one decimal place.

2. Why did 2016 net income increase by a higher percentage than net sales revenue?

Performing vertical analysis of a balance sheet

Tri Designs, Inc. has the following data:

Perform a vertical analysis of Tri Designs’s balance sheet for each year.

Exercise 3

Computing key ratios

The financial statements of Victory’s Natural Foods include the following items:

Compute the following ratios for the current year:

1. Current ratio

2. Cash ratio

3. Acid-test ratio

4. Inventory turnover

5. Days’ sales in inventory

6. Days’ sales in receivables

7. Gross profit percentage (assume all sales are on credit)