PROBLEM2

Requirements #1: Use 2014 as the base year.

2014 2015
Net Sales 20,000,000 22,000,000
Trend Ratio 1.00 1.10
Trend Index 100.00 110.00

Profit 500,000 450,000

Trend Ratio 1.00 0.90
Trend Index 100.00 90.00

Long-term Debt 10,000,000 8,000,000

Trend Ratio 1.00 0.80
Trend Index 100.00 80.00

Shareholders' Equit 20,000,000 21,000,000

Trend Ratio 1.00 1.05
Trend Index 100.00 105.00

Total Assets 34,000,000 33,200,000

Trend Ratio 1.00 0.98
Trend Index 100.00 97.65

REQUIREMENT #2: Use 2018 as the base year.

2014 2015
Net Sales 20,000,000 22,000,000
Trend Ratio 0.67 0.73
Trend Index 66.67 73.33

Profit 500,000 450,000

Trend Ratio 1.43 1.29
Trend Index 142.86 128.57

Long-term Debt 10,000,000 8,000,000

Trend Ratio 1.25 1.00
Trend Index 125.00 100.00

Shareholders' Equit 20,000,000 21,000,000

Trend Ratio 1.05 1.11
Trend Index 105.26 110.53

Total Assets 34,000,000 33,200,000

Trend Ratio 1.10 1.08
Trend Index 110.39 107.79
2016 2017 2018
25,000,000 26,000,000 30,000,000
1.25 1.30 1.50
125.00 130.00 150.00

400,000 380,000 350,000

0.80 0.76 0.70
80.00 76.00 70.00

12,000,000 11,000,000 8,000,000

1.20 1.10 0.80
120.00 110.00 80.00

22,000,000 20,000,000 19,000,000

1.10 1.00 0.95
110.00 100.00 95.00

38,400,000 35,000,000 30,800,000

1.13 1.03 0.91
112.94 102.94 90.59

2016 2017 2018

25,000,000 26,000,000 30,000,000
0.83 0.87 1.00
83.33 86.67 100.00

400,000 380,000 350,000

1.14 1.09 1.00
114.29 108.57 100.00

12,000,000 11,000,000 8,000,000

1.50 1.38 1.00
150.00 137.50 100.00

22,000,000 20,000,000 19,000,000

1.16 1.05 1.00
115.79 105.26 100.00

38,400,000 35,000,000 30,800,000

1.25 1.14 1.00
124.68 113.64 100.00