Analyzing and using the financial results trend percentages, Accounting Basics

Assignment Help:

Analyzing and using the financial results trend percentages

It is occasionally more informative to express all the dollar amounts as a percentage of one of the amounts in the base year rather than to look only at the dollar amount of the item in the financial statements. You are able to calculate trend percentages by dividing the amount for each year for an item such as net income or net sales by the amount of that item for the base yea:

Trend percentage = Current year amount / Base year amount

To exemplify assume that ShopaLot a large retailer and its subsidiaries reported the following net income for the years ended 2001 January 31 through 2010. The last column articulates these dollar amounts as a percentage of the 2001 amount. For example we would calculate the 125 per cent for 2002 as

[(USD 1,609,000/USD 1,291,000)5 100]

1216_Analyzing and using the financial results trend percentages.png

Exploratory the trend percentages we can see that ShopaLot's s net income has increased steadily over the 10-year period. The 2010 net income is above 4 times as much as the 2001 amount. This is the type of performance that management and stockholders seek but don't always get. In the initial three sections of this text you have learned most of the steps of the accounting process. Section 4 shows the final steps in the accounting cycle.


Related Discussions:- Analyzing and using the financial results trend percentages

Qualitative characteristics of financial reporting, Q. Qualitative characte...

Q. Qualitative characteristics of financial reporting? Accounting information must possess qualitative characteristics to be useful in decision making. This criterion is hard t

Which brand insulating oil tester is the best, GDYJ-503 is developed accord...

GDYJ-503 is developed according to the national standard GB-86 Insulating Oil Dielectric Strength Testing Method .The tester can test three cups of oil at the similar time. LCD scr

Accounting concepts and standards, Any activity which you perform is assist...

Any activity which you perform is assist if you comprise a set of rules to guide your efforts. Moreover, you determine that these rules are of more value to you if they are standar

Explain about the petty cash, Explain about the Petty Cash Petty Cash ...

Explain about the Petty Cash Petty Cash It is a small amount of money which is kept in the office for making small expenditures. ($10, $25, $50, etc.) Business will conclude

Determine statement that indicate manufacturing diversity, Examine each of ...

Examine each of the items listed below to determine which items include statements that 3) would indicate that manufacturing diversity exists. Required: Label the items that inc

State the classified balance sheet, State the classified balance sheet ...

State the classified balance sheet ASSETS Current Assets are cash and any other assets which are expected to be realized in cash, sold, used up or expire within one year.

Use the following information to answer questions, The Bayside Company uses...

The Bayside Company uses the LIFO cost flow method to value inventory. In the current year, profit at Bayside is running unusually high. The corporate tax rate is also high this ye

Explain about business entity concept, Q. Explain about business entity con...

Q. Explain about business entity concept? A business entity perhaps made up of several different legal entities. For example a large business such as General Motors Corporation

Provision for bad debts, A business had always made a provision for doubtfu...

A business had always made a provision for doubtful debts at the rate of 5% of debtors. On 1 January 2017 the provision for doubtful debts brought forward from the previous year wa

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd