MAKE THE TREND ANALYSIS, BOTH HORIZONTAL AND VERTICAL ANALYSIS

MAKE THE TREND ANALYSIS, BOTH HORIZONTAL AND VERTICAL ANALYSIS

MAKE THE TREND ANALYSIS, BOTH HORIZONTAL AND VERTICAL ANALYSIS

14 .. . 11:21 48 KB/S f Performance... 7 Perfomance Task #2 for Business Finance You are the financial management consultant hired by Leica Mecetes to assess the financial performance of her start-up business, the home-based bakery, Decadent Cakes and Pastries. Your tasks are to do (1) trend analysis, both vertical and horizontal and (2) financial analysis using financial ratios on liquidity, solvency, stability and profitability. Analyze te given SFP and SCI. Do the vertical and horizontal analyses accordingly. Also compute the all the applicable liquidity, solvency/stability, and profitability ratios that will be helpful to Leica to understand better the financial status of her business. Identify the indicators that will convince Leica to continue her operations next year and the areas she needs to improve on to attain a higher level of profitability. The financial data for Decadent Cakes and Pastries are as follows: Decadent Cakes and Pastries Comparative Statements of Financial Position As of 31 December 2020 and 2019 (In Philippine Peso) Account 2020 2019 Assets Current Assets Cash Accounts Receivable Prepaid Expenses Total Current Assets Non-current Assets Total Assets 35,500.00 10,000.00 7,500.00 53,000.00 85,000.00 138,000.00 25,000.00 5,000.00 3,500.00 33,500.00 50,000.00 83,500.00 25,000.00 13,500.00 Liabiltiles and Owner's Equity Current Liabilities Accounts Payable Non-current Liabilities Loans Payable Total Liabilities 59,000.00 84,000.00 50,000.00 63,500.00 Owner's Capital Leica Mecetes, Capital Total Liabilities and Owner's Equity 54,000.00 138,000.00 20,000.00 83,500.00 Decadent Cakes and Pastries Comparative Statement of Comprehensive Income For the year ended 31 December 2020 and 2019 (In Philippine Peso) Account 2020 2019 Revenues Cakes Pastries Total Revenues 105,000.00 95,500.00 200,500.00 55,000.00 36,500.00 91,500.00 Expenses Cakes and Pastries Ingredients Salaries Depreciation Utlities Supplies 60,000.00 50,000.00 3,500.00 45,000.00 8,000.00 40,000.00 36,000.00 2,500.00 25,000.00 10,000.00 RB/s . 11:21 211 48 Performance... Accounts Receivable Prepaid Expenses Total Current Assets Non-current Assets Total Assets 10,000.00 7,500.00 53,000.00 85,000.00 138,000.00 5,000.00 3,500.00 33,500.00 50,000.00 83,500.00 25,000.00 13,500.00 Liabiltiles and Owner's Equity Current Liabilities Accounts Payable Non-current Liabilities Loans Payable Total Liabilities 59,000.00 84,000.00 50,000.00 63,500.00 Owner's Capital Leica Mecetes, Capital Total Liabilities and Owner's Equity 54,000.00 138,000.00 20,000.00 83,500.00 Decadent Cakes and Pastries Comparative Statement of Comprehensive Income For the year ended 31 December 2020 and 2019 (In Philippine Peso) Account 2020 2019 Revenues Cakes Pastries Total Revenues 105,000.00 95,500.00 200,500.00 55,000.00 36,500.00 91,500.00 2/2 Expenses Cakes and Pastries Ingredients Salaries Depreciation Utlities Supplies Advertising and Promotion Taxes and Licenses Repairs and Maintenance Total Expenses 60,000.00 50,000.00 3,500.00 45,000.00 8,000.00 2,000.00 8,500.00 2,575.00 179,575.00 40,000.00 36,000.00 2,500.00 25,000.00 10,000.00 1,000.00 5,800.00 2,500.00 122.800.00 Operating Income Less: Interest Expense Net Income Before Tax Less: Income Tax Net Income After Tax 20,925.00 10,500.00 10,425.00 0.00 10,425.00 (31,300.00) 0.00 (31,300.00) 0.00 (31,300.00) A