tailieunhanh - Lecture Managerial accounting - Chapter 12: Financial statement analysis
Chapter 12 - Financial statement analysis. After studying this chapter you will be able to understand: horizontal analysis of financial statements, common size financial statements, ratio analysis, industry analysis. | CHAPTER © jsnyderdesign / iStockphoto 12 FINANCIAL STATEMENT ANALYSIS HOW HEALTHY IS C&C? C&C’s cash balance has fallen dramatically, and George Douglas wonders why. Cedric Renn, a potential employee, wonders if C&C will be around for the long term. Meredith Lincoln wonders if she should increase C&C’s credit limit. Each can use C&C’s financial statements to help answer their question. HORIZONTAL ANALYSIS OF FINANCIAL STATEMENTS Unit 12 1 . Unit Unit © Tomwang112 / iStockphoto Unit HORIZONTAL ANALYSIS Shows the percentage increase or decrease in a particular line item on the financial statements; may also be expressed in dollars Requires two years’ of information to calculate The earliest year is considered the “base year” HORIZONTAL ANALYSIS Current Year Amount – Base Year Amount Base Year Amount HORIZONTAL ANALYSIS: SALES REVENUE 12/31/13 12/31/12 $ Change % Change Sales revenue $5,237,000 $4,654,000 $583,000 Cost of goods sold 3,876,432 3,464,440 411,992 . | CHAPTER © jsnyderdesign / iStockphoto 12 FINANCIAL STATEMENT ANALYSIS HOW HEALTHY IS C&C? C&C’s cash balance has fallen dramatically, and George Douglas wonders why. Cedric Renn, a potential employee, wonders if C&C will be around for the long term. Meredith Lincoln wonders if she should increase C&C’s credit limit. Each can use C&C’s financial statements to help answer their question. HORIZONTAL ANALYSIS OF FINANCIAL STATEMENTS Unit 12 1 . Unit Unit © Tomwang112 / iStockphoto Unit HORIZONTAL ANALYSIS Shows the percentage increase or decrease in a particular line item on the financial statements; may also be expressed in dollars Requires two years’ of information to calculate The earliest year is considered the “base year” HORIZONTAL ANALYSIS Current Year Amount – Base Year Amount Base Year Amount HORIZONTAL ANALYSIS: SALES REVENUE 12/31/13 12/31/12 $ Change % Change Sales revenue $5,237,000 $4,654,000 $583,000 Cost of goods sold 3,876,432 3,464,440 411,992 Gross margin 1,360,568 1,178,560 171,008 Selling and administrative expenses 1,160,566 1,067,721 92,845 Operating income 200,002 121,839 78,163 Interest expense 41,715 43,210 (1,492) () Income before taxes 158,287 78,629 79,658 Income tax expense 47,486 23,589 23,897 Net income $ 110,801 $ 55,040 $ 55,761 HORIZONTAL ANALYSIS: SALES REVENUE 12/31/13 12/31/12 $ Change % Change Sales revenue $5,237,000 $4,654,000 $583,000 Cost of goods sold 3,876,432 3,464,440 411,992 Gross margin 1,360,568 1,178,560 171,008 Selling and administrative expenses 1,160,566 1,067,721 92,845 Operating income 200,002 121,839 78,163 Interest expense 41,715 43,210 (1,492) () Income before taxes 158,287 78,629 79,658 Income tax expense 47,486 23,589 23,897 Net income $ 110,801 $ 55,040 $ 55,761 DO NOT add the % change column to get totals HORIZONTAL ANALYSIS ALLOWS US TO Identify trends and changes in account .
đang nạp các trang xem trước
