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Description / Instructions: Complete the following in WileyPLUS: *Brief Exercise 13-4 *Brief
Exercise 13-5 *Brief Exercise 13-8 (essay) *Brief Exercise 13-9 (essay) *Brief Exercise 13-10
*Brief Exercise 13-13 *Brief Exercise 13-15

Question 1
Using these data from the comparative balance sheet of Rosalez Company, perform
horizontal analysis. (If amount and percentage are a decrease show the
numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round
percentages to 0 decimal places, e.g. 12%.)
Increase or (Decrease)
Dec. 31,
2012

Dec. 31,
2011

Accounts
receivable

\$ 512,300

\$ 369,200

Inventory

\$ 794,900

\$ 585,100

\$3,168,300

\$2,708,800

Total assets

Amount

Percentage

Question 2
Using these data from the comparative balance sheet of Rosalez Company, perform
vertical analysis. (Round percentages to 1 decimal place, e.g. 12.5%.)
Dec. 31, 2012
Amount
Percentage

Dec. 31, 2011

Amount
Percentage

Accounts receivable

\$ 501,200

\$ 397,600

Inventory

\$ 812,300

\$ 642,100

\$3,142,500

\$2,822,200

Total assets

Answers to questions start on PAGE 3

Question 3
Vertical analysis (common-size) percentages for Vallejo Companys sales, cost of goods
sold, and expenses are listed here.
Vertical Analysis
Sales

2012
100 %

2011
100 %

2010
100

Cost of goods sold

61.1

63.5

66.1

Expenses

25.2

26.4

29.5

Did Vallejos net income as a percent of sales increase, decrease, or remain unchanged
over the 3-year period? Provide numerical support for your answer.

Question 4
Horizontal analysis (trend analysis) percentages for Spartan Companys sales, cost of

goods sold, and expenses are listed here.

Horizontal Analysis
Sales

2012
96.2 %

2011

2010

104.8 %

100.0

101.0

98.0

100.0

Expenses

105.6

95.4

100.0

Explain whether Spartans net income increased, decreased, or remained unchanged

over the 3-year period.

Question 5

These selected condensed data are taken from recent balance sheets of Bob Evans
Farms (in thousands).
2009
Cash

2008

\$ 13,606

Accounts receivable

23,045

Inventories

31,087

12,522

\$ 80,260

\$245,805

\$326,203

Answers to questions start on PAGE 3

Compute the current ratio for each year. (Round answers to 2 decimal places,
e.g. .12 : 1.)
2009
Current ratio:

2008

:1

:1

Question 6
Staples, Inc. is one of the largest suppliers of office products in the United States.
It had net income of \$738.7 million and sales of \$24,275.5 million in 2009. Its total
assets were \$13,073.1 million at the beginning of the year and \$13,717.3 million at
the end of the year. What is Staples, Inc.s asset turnover ratio and profit margin
ratio?(Round answers to 2 decimal places, e.g. 1.25 or 2.05%.)

times

Profit margin ratio

Question 7
Selected data taken from a recent years financial statements of trading card
company Topps Company, Inc. are as follows (in millions).
Net sales
Current liabilities, beginning of year

Current liabilities, end of year

Net cash provided by operating activities
Total liabilities, beginning of year
Total liabilities, end of year
Capital expenditures
Cash dividends
Compute these ratios: current cash debt coverage ratio, cash debt coverage ratio, and
free cash flow. Provide a brief interpretation of your results. (Round answers to 2
decimal places, e.g. 0.12.)

times

times
\$

millions

Answers to questions start on PAGE 3

Question 1
Using these data from the comparative balance sheet of Rosalez Company, perform
horizontal analysis. (If amount and percentage are a decrease show the numbers
as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 0
decimal places, e.g. 12%.)

Accounts receivable

\$ 512,300

Inventory
Total assets

Dec. 31, 2011

\$ 369,200

\$ 794,900

\$ 585,100

\$3,168,300

\$2,708,800

Increase or (Decrease)
Amount
Percentage
38.8 %
\$ 143,100
35.9 %
\$ 209,800
\$ 459,500

17.0 %

Question 2
Using these data from the comparative balance sheet of Rosalez Company, perform vertical
analysis. (Round percentages to 1 decimal place, e.g. 12.5%.)

Inventory

Dec. 31, 2012

Amount
Percentage
15.9 %
\$ 501,200
25.8 %
\$ 812,300

Total assets

\$3,142,500

Accounts receivable

100 %

Dec. 31, 2011

Amount
Percentage
14.1 %
\$ 397,600
22.8 %
\$ 642,100
\$2,822,200

100 %

Question 3
Your answer has been saved and sent to the instructor. See Gradebook for score details.
Vertical analysis (common-size) percentages for Vallejo Companys sales, cost of goods sold,
and expenses are listed here.
Vertical Analysis
Sales

2012
100 %

2011
100 %

2010
100 %

Answers to questions start on PAGE 3

Cost of goods sold

61.1

63.5

66.1

Expenses

25.2

26.4

29.5

Did Vallejos net income as a percent of sales increase, decrease, or remain unchanged over
the 3-year period? Provide numerical support for your answer.
For 2012: 100-61.6-25.2=13.7 For 2011: 100-63.5-26.4=10.1 For 2010: 100-66.129.5=4.4 The net income increased as a percent of sales due to the decrease in both the
cost of goods sold and expenses each year.

Question 4
Your answer has been saved and sent to the instructor. See Gradebook for score details.
Horizontal analysis (trend analysis) percentages for Spartan Companys sales, cost of goods
sold, and expenses are listed here.
Horizontal Analysis
Sales

2012
96.2 %

2011

2010

104.8 %

100.0

Cost of goods sold

101.0

98.0

100.0

Expenses

105.6

95.4

100.0

Explain whether Spartans net income increased, decreased, or remained unchanged over
the 3-year period.
2010: 100-100-100=0 2011: 104.8-98.0-95.4=(88.6) 2012: 96.2-101.0-105.6=(110.4)
In 2010 the net income is 0. In 2011 it decreased as a percent of sales in which sales
increased but the cost of goods and expenses slightly decreased. In 2012 net sales further
decreased and the cost of goods and expenses increased.

Answers to questions start on PAGE 3

Question 5
These selected condensed data are taken from recent balance sheets of Bob Evans
Farms (in thousands).
2009
Cash

2008

\$ 13,606

\$ 7,669

Accounts receivable

23,045

19,951

Inventories

31,087

31,345

12,522

11,909

\$ 80,260

\$ 70,874

Total current liabilities

\$245,805

\$326,203

Question 5
Compute the current ratio for each year. (Round answers to 2 decimal places, e.g. .12
: 1.)

Current ratio:

Question 6

2009
.33:1

2008
.22:1

Answers to questions start on PAGE 3

Staples, Inc. is one of the largest suppliers of office products in the United States. It had net
income of \$738.7 million and sales of \$24,275.5 million in 2009. Its total assets were
\$13,073.1 million at the beginning of the year and \$13,717.3 million at the end of the year.
What is Staples, Inc.s asset turnover ratio and profit margin ratio? (Round answers to 2
decimal places, e.g. 1.25 or 2.05%.)
Asset turnover ratio
Profit margin ratio

1.81 times
3.04 %

Question 7
Selected data taken from a recent years financial statements of trading card company Topps
Company, Inc. are as follows (in millions).
Net sales

\$326.7

41.1

62.4

10.4

65.2

Total liabilities, end of year

73.2

Capital expenditures

3.7

Cash dividends

6.2

Compute these ratios: current cash debt coverage ratio, cash debt coverage ratio, and free
cash flow. Provide a brief interpretation of your results. (Round answers to 2 decimal
places, e.g. 0.12.)
Current cash debt coverage ratio
Cash debt coverage ratio
Free Cash Flow

0.20 times
0.15 times
\$ 0.5 millions