The following items were taken from the financial statements of Ritz Inc. over a four-year period:...

Transcribed Image Text:

The following items were taken from the financial statements of Ritz Inc. over a four-year period: Year 4 Year 2 Year 1 $570,000 $540,000 $550,000 420,000 500,000 400,000 $150,000 $40,000 $150,000 Item Net sales Cost of goods sold Gross margin Note: Round final answers to the nearest whole number. Required: Using horizontal analysis and Year 1 as the base year, compute the trend percentages for net sales, cost of goods sold, and gross profit. Year 4 Year 1 Year 3 1 X % Year 2 1 X % 1 X % 140 % Item Net sales Cost of goods sold Gross margin Feedback Check My Work Partially correct 1 X % Year 3 $600,000 390,000 $210,000 1 X % 10 X % 1 X % 1 X % 0 X % 1 X % 1 X % The following items were taken from the financial statements of Ritz Inc. over a four-year period: Year 4 Year 2 Year 1 $570,000 $540,000 $550,000 420,000 500,000 400,000 $150,000 $40,000 $150,000 Item Net sales Cost of goods sold Gross margin Note: Round final answers to the nearest whole number. Required: Using horizontal analysis and Year 1 as the base year, compute the trend percentages for net sales, cost of goods sold, and gross profit. Year 4 Year 1 Year 3 1 X % Year 2 1 X % 1 X % 140 % Item Net sales Cost of goods sold Gross margin Feedback Check My Work Partially correct 1 X % Year 3 $600,000 390,000 $210,000 1 X % 10 X % 1 X % 1 X % 0 X % 1 X % 1 X %

Answer rating: 100% (QA)

To compute the trend percentages using horizontal analysis we will compare each item to the base yea... View the full answer