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Vertical Analysis and Ratio Calculations

Please see attached file.
Use Excel format.

Mickey Company and Minnie Company: prepare a vertical analysis

Art Mart Company: compute financial ratios

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Please see the attached file. 2 questions are in two sheets

In vertical analysis all elements are expressed as a percentage of some base.
For Income Statement the base in net sales and for Balance Sheet the base is total assets

Vertical Analysis 2007
Mickey Company % of Sales Minnie Company % of Sales
Net Sales 490,000 100.00% 620,000 100.00%
Cost of Goods Sold 231,000 47.14% 274,000 44.19%
Gross Profit 259,000 52.86% 346,000 55.81%
Operating Expenses 29,000 5.92% 97,000 15.65%
Operating Profit 230,000 46.94% 249,000 40.16%
Interest Expense 5,000 1.02% 3,000 0.48%
Earnings Before Tax 225,000 45.92% 246,000 39.68%
Income Tax Expense 68,000 13.88% 75,000 12.10%
Net Income 157,000 32.04% ...

Solution Summary

The solution has two problems - Vertical analysis for Mickey and Minnie Company and calculation of various ratios for Art Mart Company

$2.19