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    Horizontal and vertical analysis

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    The company balance sheets of Ramsey Corp. are presented below.
    Ramsey Corp. Comparative Balance Sheets
    December 31 2007 2006
    Assets $ $
    -current assets 76,000 80,000
    Property,plant,and 99,000 90,000
    Intangibles 25,000 40,000
    -Total assess $200,000 $210,000
    Liabilities and stock- $ $
    holders equity
    -current liabilities 40,800 48,000
    long term liabilities 143,000 150,000
    stockholders equity 16,200 12,000
    -Total liabilities & $200,000 $210,000
    stockholders equity

    a.prepare a horizontal analysis of the balance sheet data for Ramsey corp. using 2006 as a base.
    b. Prepare a vertical analysis of the balance sheet data for Ramsey corp. in columnare form for 2007.

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    a. In Horizontal analysis, we calculate the percentage change in the value for each variable in respect to the base. For example the current ...

    Solution Summary

    The solution explains how to prepare a horizontal and vertical analysis.