Comtemporary Wood Fur

Comparative Balance S
December 31, 2010 and
2011
Amount

Percent

Assets
Current Asstes
Cash
Accounts Receivable
Inventory
Total Current Assets

$1,844
11,807
9,628
23,279

1,0
6.5
5.3
12.8

Plant and Equipment

Equipment
Total Plant and Equipment
Total Assets

158,700
158,700
$181,979

87.2
87.2
100

Liabilities
Current Liabilities
Accounts Payable
Wages Payable
Property and Taxes Payable
Total current liabilities

$13,446
650
4,124
$18,220

7.3
0.4
0.2
10

Long Term Liabilities

Total Term Liabilities
Total Liabilities

92,800
$111,020

51
61

Owner's Equity
C.Royston, capital
Total Liabilities and owner' equity

70,959
$181,979

39
100

Comtemporary Wood Furniture

Comparative Balance Sheet
December 31, 2010 and 2011
2010
Amount

Percent

$3,278
6,954
17,417
27,649

1.9
40.4
10.1
16.1

144,500
144,500
$172,149

83.9

83.9
100

$9,250
1,110
$3,650
$14,010

5.4
0.6
2.1
8.1

75,800
89,810

44
52.1

82,339
$172,149

47.8
100

2011
Cash

1844/181979=
0.010133037(100)=
Round off 1.0
Accounts Receivable
11807/181979=
(0.064881113)(100)=
Round off
Inventory
9628/181979=
(0.052907204)(100)=
Round Off
Total Current Asset
23279/181979=
(0.127921354)(100)=
Round off
Plant and Equipment 158700/181979=
(0.872078646)(100)=
Round off
Total Asset
181979/181979=
(1)(100)=
Accounts Payable 13446/181979=
(0.07338746)(100)=
Round off
Wages Payable
650/181979=
(0.0035571841)(100)=
Round off
Property and Taxes Payable
4124/181979=
(0.0022661956)(100)=
Round off
Total Current Liabilities
18220/181979=
(0.100121443)(100)=
Round off
Total Long Term Liabilities
92800/181979=
(0.50994895)(100)=
Round off
Total Liabilities
111020/181979=
(0.610070393)(100)=
Round off

Owner's Equity

70959/181979=
(0.38992961)(100)=
Round off

0.0101330373
1.0133037
0.0648811127
6.48811139
6.5
0.0529072036
5.2907204
5.3
0.1279213536
12.7921354
12.8
0.8720786464
87.2078646
87.2
1
100
0.0738876464
7.338746
7.3
0.0035718407
0.355718141
0.4
0.0226619555
0.22661956
0.2
0.1001214426
10.0121443
10
0.5099489502
50.994895
51
0.6100703927
61.0070393
61

0.3899296073
38.99261
39

Total Liabilities and Owner's Equity

181979/181979=
(1)(100)
Round off

1
100
100

2010
Cash

Account Receivable

Inventoy

Total Current Asset

Plant and Equipment

Total Asset
Accounts Payable

Wages Payable

Property and Taxes Payable

Total Current Liabilities

Long Term Liabilities

Total Liabilities

Owner's Equity

Total Liabilities and Owner's Equity

2010
3278/172149= 0.01904164
(0.01904)(100)=
1.904
Round Off
1.9
6954/172149= 0.04039524
(0.404)(100)=
40.4
Round off
40.4
17417/172149= 0.10117398
(0.10117)(100)=
10.117
Round off
10.1
27649/172149= 0.16061087
(0.16061)(100)=
16.061
Round off
16.1
144500/172149= 0.83938913
(0.83939)(100)=
83.939
Round off
83.9
172149/172149=
1
(1)(100)=
100
9250/172149= 0.05373252
(0.05373)(100)=
5.373
Round Off
5.4
1110/172149= 0.0064479
(0.00645)(100)=
0.645
Round off
0.6
3650/172149= 0.02120256
(0.0212)(100)=
2.12
Round Off
2.1
14010/172149= 0.08138299
(0.08138)(100)=
8.138
Round off
8.1
75800/172149=
0.44031624
(0.44032)(100)
44.032
Round off
44
89810/172149= 0.52169923
(0.5217)(172149)=
52.17
Round off
52.1
82339/172149= 0.47830077
(0.4783)(100)=
47.83
Round off
47.8

172149/172149=
(1)(100)=
Round off

1
100
100

Contemporary Wood Furniture

Comparative Balance Sheet
December 31, 2010 and 211

2011

2010

$1,844
11,807
9,628
158,700
$181,979

$3,278
6954
17,417
144,500
$172,149

Liabilities
Accounts Payable
Wages Payable
Property and Taxes Payable
Long Term Debts
Total Liabilities

13,446
650
4,124
92,800
111,020

9,250
1,110
3,650
75,800
89,810

Owner's Equity
C. Royston, capital
Total Liabilities and Owner's Equity

70,959
181,979

82,339
172,149

Assets
Cash
Accounts Receivable
Inventory
Equipment
Total Assets

ry Wood Furniture
ve Balance Sheet
31, 2010 and 211
Increase
(Decrease)*
Amount

Percent

($1,434)
$4,853
($7,789)
$14,200
$9,830

(43.75)
69.80
(44.72)
9.8
5.7

Solution for amount Incre

Amount = 1844 - 3278
Amount = 11807 - 6954
Amount = 9628 - 17417
Amount = 158700 - 14450
Amount = 181979 - 17214

$4,196
($460)
$474
$17,000
$21,210

45.4
(41.40)
13
22.4
23.6

Amount = 13446 - 9250

Amount = 650 - 1110
Amount = 4124 - 3650
Amount = 92800 - 75800
Amount = 111020 - 8981

($11,380)
$9,830

(13.80)
5.7

Amount = 70959 - 82339

Amount = 181979 - 17214

tion for amount Increase (Decrease)

Amount = 1844 - 3278
Amount = 11807 - 6954
Amount = 9628 - 17417
mount = 158700 - 144500
mount = 181979 - 172149

Solution for increase or decrease

Percentage = (1434)/3278 * 100%
Percentage = 4853/6964 * 100%
Percentage = (7789)/17417 * 100%
Percentage = 14200/144500 * 100%
Percentage = 9830/172149 * 100%

Amount = 13446 - 9250

Amount = 650 - 1110
Amount = 4124 - 3650
mount = 92800 - 75800
mount = 111020 - 89810

Percentage = 4196/9250 * 100%

Percentage = (460)/1110 * 100%
Percentage = 474/3650 * 100%
Percentage = 17000/75800 * 100%
Percentage = 21210/89810 * 100%

mount = 70959 - 82339

mount = 181979 - 172149

Percentage = (11380)/82339 * 100%

Percentage = 9830/172149 * 100%

Solution for increase or decrease

Percentage = (1434)/3278 * 100%
Percentage = 4853/6964 * 100%
Percentage = (7789)/17417 * 100%
Percentage = 14200/144500 * 100%
Percentage = 9830/172149 * 100%

Percentage = 4196/9250 * 100%

Percentage = (460)/1110 * 100%
Percentage = 474/3650 * 100%
Percentage = 17000/75800 * 100%
Percentage = 21210/89810 * 100%

Percentage = (11380)/82339 * 100%

Percentage = 9830/172149 * 100%

Current Ratio and Total Debit to Total Ratio

Current Ratio 2010
Current Assets
Current Liabilities
Current Assets
Current Liabilities

27649
14010
Answer
Answer Round off
Current Ratio

1.9735189151
2
2 to 1

Total Debit to Total Ratio 2010

Total Liabilities
Total Assets
Total Liabilities
Total Asset
Answer
Answer Round off
Total Ratio

172149
14010
12.2875802998
12.3
12.3 to 1

d Total Debit to Total Ratio

Current Ratio 2011
Current Assets
Current Liabilities
Current Assets
Current Liabilities

23279
18220

Answer
Answer Round off
Current Ratio

1.27766
1.2
1.2 to 1

Total Debit to Total Ratio 2011

Total Liabilities
Total Assets
Total Liabilities
Total Asset
Answer
Answe Round Off
Total Ratio

111020
181979
0.6100703927
0.61
0.61 to 1

3. Overall, what does your analysis mean? Is Charles correct to be concerned about these numbers? Explain
The Current ratio for 2010 is good because the assets are greater than the liabilities. In 2011 the current ratio went d
2 in 2010 to 1.2 in 2011. This is means that the assets are still greater than the liabilities but it shows there are some l
total debt to total ratio in 2010 is 12.3 means that the debts are extremely high. In 2011 the same ratio went to the ind
means the debts are ok. The vertical balance shows that the total assets in dollars were stronger than the liabilities. If
at 2010 the asset in dollars are stonge as well. The main concern is the percentage of both years. The percentage of cu
2010 is higher than 2011. In 2011 the total liabilities were higher than 2010 total liabilities. This usually means that C
are not under control or he is not having much cash comming into to the business. In the horizontal balance sheet con
is losing mony and inventory. Charles is correct to be concerned. He has to find a solution to increase cash and asset
The liabilities.

these numbers? Explain

2011 the current ratio went down from
but it shows there are some losses. The
he same ratio went to the industry average
tronger than the liabilities. If we take a look
h years. The percentage of current assets in
es. This usually means that Charles liabilities
horizontal balance sheet confirms that Charles
on to increase cash and assets. He needs to lower

Amount

Carlton
Balance Sheet
For year ending December 31, 2011
Percent

Assets
Current Assets
Cash
Accounts Receivable
Merechandise Inventory
Total Current Assets

$4,000
6,000
15,000
$25,000

10
15
37.5
62.5

Plant and Equipment

Equipment
Total Assets

15,000
$40,000

37.5
100

3,500
500
1,500
5,500

8.75
1.25
3.75
13.75

34,500
40,000

86.3
100

Liabiities
Current Liabilities
Accounts Payable
Insurnce Payable
Wages Payables
Total Liabilities
Owner's equity
Carlton,capital
Total Liabilities and Equity

Cash
Accounts Receivable
Merchandise Inventory
Total Assets
Plant and Equipment
Total Assets
Accounts Payable

Insurance Payable

Wages Payable

Total Liabilities

Carlton, Capital

Total Liabilities and Owner's Equity

Show Your Work and calculations

4,000/40,000=
(0.1)(100)=
6,000/40,000=
(0.15)(100)=
15,000/40,000=
(0.375)(100)=
25,000/40,000=
(0.625)(100)=
15,000/40,000=
(0.375)(100)=
40,000/40,000=
(1)(100)=
3,500/40,000=
(0.0875)(100)=

0.1
10
0.15
15
0.375
37.5
0.625
62.5
0.375
37.5
1
100
0.0875
8.75

500/40,000=
(0.0125)(100)=

0.0125
1.25

1,500/40,000=
(0.0375)(100)=

0.0375
3.75

5,500/40,000=
(0.1375)(100)=

0.1375
13.75

34,500/40,000=
(0.8625)(100)=

0.8625
86.25

40,000/40,000=
(1)(100)=

1
100

Net Sales
Cost of Goods
Gross Profits
Opreating Expenses
Net Income

Amount
$120,000
85,000
$35,000
33,000
$2,000

Carlton
Income Statement
For the year ending December 31, 2011
Percent
of Net Sales
100
7.8
2.9
27.5
1.7

Depreciation
Rent expense
Wages
Utilities
Miscellanous Expenses
Total Operating Expenses
Net Sales
Cost of Goods

Gross Profit

Operating Expenses
Net Income

Show Your work and your Calucaltions

2,000
15,000
8,000
6,500
1,500
33,000
120000/120000=
1
(1)(100)=
100
85,000/120,000= 0.708333333
(0.708333)(100)=
70.833
Round Off
70.8
35000/120000= 0.029166667
(0.029167)(100)=
2.9167
Round Off
2.9
33000/120000=
0.275
(0.275)(100)=
27.5
2000/120000= 0.016666667
(0.016667)/(100)=
1.6667
Round off
1.7

Current Ratios
Current Assets
Cash
Accounts Receivable
Merechandise Inventory
Total Current Assets
Current Liabilities
Accounts Payable
Insurance Payable
Wages Payable
Total Liabilites
Current Ratio=

Current Asset
Current Liabilities

4000
6000
15000
25000

3500
500
1500
5500
Current Assets
Current Liabilities
25000
5500

Current Ratio 4.54545455

Current Ratio Round off
4.5
Current Ratio 4.5 to 1

Acid Test Ratio

Acid Test Ratio =

Quick Current Assets

Current Liabilites
Quick Current Assets
Current Liabilities
Quick Current Assets
Current Liabilities
Answer
Round to
Acid Test Ratio

$4,000 + $6,000
$5,500
10,000
$5,500
1.81818181
1.82
1.82 to 1

Hope's Calculations
Acid Test Ratio
Cash
Accounts Receivable
Total
Wages Payable
Accounts Payable
Insurance Payable
Total Liabilities

$4,000
6,000
$10,000
1,500
3,500
500
5,500