The balance sheets for Sports Unlimited for 2021 and 2020 are provided below.

Required:

1. Prepare a vertical analysis of Sports Unlimited’s 2021 and 2020 balance sheets. Express each amount as a percentage of total assets for that year.

2. Prepare a horizontal analysis of Sports Unlimited’s 2021 balance sheet using 2020 as the base year.

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SPORTS UNLIMITED Balance Sheets For the years ended December 31 2021 2020 Assets Current assets: $103,500 46,800 $ 70,400 32,000 Cash Accounts receivable Inventory 44,550 71,200 Prepaid rent 7,200 3,600 Long-term assets: Investment in bonds 54,900 Land 117,450 141,600 Equipment 106,200 102,000 Less: Accumulated depreciation (30,600) $450,000 (20,800) $400,000 Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 30,150 $ 46,800 Interest payable 7,200 3,600 Income tax payable 12,150 10,000 Long-term liabilities: Notes payable 138,150 127,600 Stockholders' equity: Common stock 144,000 144,000 Retained earnings 118,350 $450,000 68,000 $400,000 Total liabilities and stockholders' equity