Instructions: Perform a Financial Statement Analysis of Bell Pepper Corporation to assess the overall performance of...

Transcribed Image Text:

Instructions: Perform a Financial Statement Analysis of Bell Pepper Corporation to assess the overall performance of the corporation. The Financial statements of Bell Pepper Corporation are shown below. The market price of Bell Pepper's ordinary share was P20 per share on November 30, 2020. Use this information to conduct your analysis. Bell Pepper Corporation Statement of Financial Position Accounts payable Wages payable Total current liabilities Bonds payable, 10% Total liabilities As of November 30 (in thousands of pesos) Cash Trading securities Accounts receivable (net) Merchandise inventory Total current assets Property, plant, and equipment (net) Long-term investments Total assets Ordinary share capital, no par, 10,000,000 shares Accumulated profits Total shareholders' equity Total liabilities and shareholders' equity 2020 P 3,000 1,000 14,000 24,000 42,000 68,000 10,000 P120,000 P P P 5,000 1,000 6,000 20,000 P 26,000 P 25,000 69,000 P 94,000 P120,000 P 30,000 60,000 10,000 P100,000 2019 P 2,000 1,000 11,000 16,000 P P 4,000 1,000 5,000 20,000 P 25,000 P 25,000 50,000 P 75,000 P100,000 Sales (all on credit) Cost of goods sold Gross margin Operating expenses Bell Pepper Corporation Statement of Income For the Year Ended November 30, 2020 (in thousands of pesos) Net operating income Interest expense Net income before income tax Income tax expense Net income 2020 P200,000 (120,000) 80,000 (38,000) 42,000 (2,000) 40,000 (15,000) P 25,000 2019 P 180,000 (90,000) P 90,000 (P45,000) 45,000 (6,000) P 39,000 (17,000) P 22,000 2018 P 130,000 (54,000) P 76,000 (P42,000) 34,000 (6,000) P 28,000 (8,000) P 20,000 REQUIRED: USE THE FORMAT GIVEN FOR EACH OF THE ANALYSIS AND USE IT AS YOUR ANSWER SHEET. (FS COMPUTATIONS AND ANALYSIS WILL BE GIVEN EQUAL POINTS.) A. Perform a Horizontal Analysis- Increase/ (Decrease) Method. Round off the amount and the percentage change to 2 decimal places. 5 points +5 analysis Cash Trading securities Accounts receivable (net) Merchandise inventory Total current assets Property, plant, and equipment (net) Long-term investments Total assets Accounts payable Wages payable Total current liabilities Bonds payable, 10% Total liabilities Ordinary share capital, no par, 10,000,000 shares Accumulated profits Total shareholders' equity Total liabilities and shareholders' equity Bell Pepper Corporation Statement of Financial Position As of November 30 (in thousands of pesos) 2020 2019 P 2,000 1,000 11,000 16,000 P 3,000 1,000 14,000 24,000 P 42,000 P 68,000 10,000 P120,000 P 5,000 1,000 6,000 20,000 P 26,000 P 25,000 69,000 P 94,000 P120,000 P 30,000 60,000 10,000 P100,000 P P 4,000 1,000 5,000 20,000 P 25,000 P 25,000 50,000 P 75,000 P100,000 Amount % Change ANALYSIS B. Perform a Vertical Analysis/ Common-Size Analysis Method. Round off the amount and the percentage change to 2 decimal places. 5 points +5 analysis Cash Trading securities Accounts receivable (net) Merchandise inventory Total current assets Property, plant, and equipment (net) Long-term investments Total assets Accounts payable Wages payable Total current liabilities Bonds payable, 10% Total liabilities Ordinary share capital, no par, 10,000,000 shares Accumulated profits Total shareholders' equity Total liabilities and shareholders' equity 2020 P 3,000 1,000 14,000 24,000 P 42,000 P 68,000 10,000 P120,000 P 5,000 1,000 6,000 20,000 P 26,000 P 25,000 69,000 P 94,000 P120,000 Percentage 2019 P 2,000 1,000 11,000 16,000 P 30,000 60,000 10,000 P100,000 P P 4,000 1,000 5,000 20,000 P 25,000 P 25,000 50,000 P 75,000 P100,000 Percentage ANALYSIS Instructions: Perform a Financial Statement Analysis of Bell Pepper Corporation to assess the overall performance of the corporation. The Financial statements of Bell Pepper Corporation are shown below. The market price of Bell Pepper's ordinary share was P20 per share on November 30, 2020. Use this information to conduct your analysis. Bell Pepper Corporation Statement of Financial Position Accounts payable Wages payable Total current liabilities Bonds payable, 10% Total liabilities As of November 30 (in thousands of pesos) Cash Trading securities Accounts receivable (net) Merchandise inventory Total current assets Property, plant, and equipment (net) Long-term investments Total assets Ordinary share capital, no par, 10,000,000 shares Accumulated profits Total shareholders' equity Total liabilities and shareholders' equity 2020 P 3,000 1,000 14,000 24,000 42,000 68,000 10,000 P120,000 P P P 5,000 1,000 6,000 20,000 P 26,000 P 25,000 69,000 P 94,000 P120,000 P 30,000 60,000 10,000 P100,000 2019 P 2,000 1,000 11,000 16,000 P P 4,000 1,000 5,000 20,000 P 25,000 P 25,000 50,000 P 75,000 P100,000 Sales (all on credit) Cost of goods sold Gross margin Operating expenses Bell Pepper Corporation Statement of Income For the Year Ended November 30, 2020 (in thousands of pesos) Net operating income Interest expense Net income before income tax Income tax expense Net income 2020 P200,000 (120,000) 80,000 (38,000) 42,000 (2,000) 40,000 (15,000) P 25,000 2019 P 180,000 (90,000) P 90,000 (P45,000) 45,000 (6,000) P 39,000 (17,000) P 22,000 2018 P 130,000 (54,000) P 76,000 (P42,000) 34,000 (6,000) P 28,000 (8,000) P 20,000 REQUIRED: USE THE FORMAT GIVEN FOR EACH OF THE ANALYSIS AND USE IT AS YOUR ANSWER SHEET. (FS COMPUTATIONS AND ANALYSIS WILL BE GIVEN EQUAL POINTS.) A. Perform a Horizontal Analysis- Increase/ (Decrease) Method. Round off the amount and the percentage change to 2 decimal places. 5 points +5 analysis Cash Trading securities Accounts receivable (net) Merchandise inventory Total current assets Property, plant, and equipment (net) Long-term investments Total assets Accounts payable Wages payable Total current liabilities Bonds payable, 10% Total liabilities Ordinary share capital, no par, 10,000,000 shares Accumulated profits Total shareholders' equity Total liabilities and shareholders' equity Bell Pepper Corporation Statement of Financial Position As of November 30 (in thousands of pesos) 2020 2019 P 2,000 1,000 11,000 16,000 P 3,000 1,000 14,000 24,000 P 42,000 P 68,000 10,000 P120,000 P 5,000 1,000 6,000 20,000 P 26,000 P 25,000 69,000 P 94,000 P120,000 P 30,000 60,000 10,000 P100,000 P P 4,000 1,000 5,000 20,000 P 25,000 P 25,000 50,000 P 75,000 P100,000 Amount % Change ANALYSIS B. Perform a Vertical Analysis/ Common-Size Analysis Method. Round off the amount and the percentage change to 2 decimal places. 5 points +5 analysis Cash Trading securities Accounts receivable (net) Merchandise inventory Total current assets Property, plant, and equipment (net) Long-term investments Total assets Accounts payable Wages payable Total current liabilities Bonds payable, 10% Total liabilities Ordinary share capital, no par, 10,000,000 shares Accumulated profits Total shareholders' equity Total liabilities and shareholders' equity 2020 P 3,000 1,000 14,000 24,000 P 42,000 P 68,000 10,000 P120,000 P 5,000 1,000 6,000 20,000 P 26,000 P 25,000 69,000 P 94,000 P120,000 Percentage 2019 P 2,000 1,000 11,000 16,000 P 30,000 60,000 10,000 P100,000 P P 4,000 1,000 5,000 20,000 P 25,000 P 25,000 50,000 P 75,000 P100,000 Percentage ANALYSIS

Answer rating: 100% (QA)

A Horizontal Analysis The horizontal analysis also known as the trend analysis evaluates the changes in financial statement items over multiple periods to identify trends and assess performance Here w... View the full answer