Examlex

Solved

Comparative Financial Statements for Cross, Inc Using Horizontal Analysis, How Much Is Cross, Inc

question 47

Multiple Choice

Comparative financial statements for Cross, Inc.are shown below:  December 3120182017 Assets  Current assets:  Cash $89,103$68,203 Accounts receivable 142,000135,000 Inventory 96,70885,694 Prepaid expenses 21,2035,118 Total current assets 349,014294,015 Property, plant and equipment, net 822,576718,144 Total assets $1.171.590$1012,159 Liabilities and Stockholders’ Equity  Current liabilities:  Accounts payable $85,443$62,394 Other current liabilities 38,11233,507 Total current liabilities 123,55595,901 Long-term debt 302,430290,324 Total liabilities 425,985386,225 Stockholders’ equity:  Common stock 600,000600,000 Retained earnings 145,60525,934 Retained earnings 14,7008,000 Total stockholders’ equity 745,605625,934 Total liabilities and stockholders’ equity $1,171,590$1,012,159 Year Ended December 3120182017 Net sales $17,005,852$13,809,585 Cost of goods sold 12,250,2579,825,614 Gross margin 4,755,5953,983,971 Operating expense 3,585,6573,400,258 Operating income 1,169,938583,713 Interest expense 28,50027,300 Earnings before tax 1,141,438556,413 Income taxes 342,431166,924 Net income $799,007$389,489\begin{array}{lrrr}&\text { December } 31\\&2018&2017\\\text { Assets }\\\text { Current assets: }\\\text { Cash } & \$ 89,103 & \$ 68,203 \\\text { Accounts receivable } & 142,000 & 135,000 \\\text { Inventory } & 96,708 & 85,694 \\\text { Prepaid expenses } & 21,203 & 5,118 \\\text { Total current assets } & 349,014 & 294,015 \\\text { Property, plant and equipment, net } & 822,576 & \mathbf{7 1 8 , 1 4 4} \\\text { Total assets } & \$ 1.171 .590 & \$ 1012,159 \\\text { Liabilities and Stockholders' Equity }\\\text { Current liabilities: }\\\text { Accounts payable } & \$ \quad 85,443 & \$ 62,394 \\\text { Other current liabilities } & 38,112 & 33,507 \\ \text { Total current liabilities } & 123,555 & 95,901 \\\text { Long-term debt } & 302,430 & 290,324 \\\text { Total liabilities } & 425,985 & 386,225\\\text { Stockholders' equity: }\\\text { Common stock } & 600,000 & 600,000 \\\text { Retained earnings } & 145,605 & 25,934 \\\text { Retained earnings } & 14,700 & 8,000 \\\text { Total stockholders' equity }&745,605&625,934 \\\text { Total liabilities and stockholders' equity } &\$1,171,590&\$1,012,159\\\\&\text { Year Ended December } 31\\&2018&2017\\\text { Net sales } & \$ 17,005,852 & \$ 13,809,585 \\\text { Cost of goods sold } & 12,250,257 & 9,825,614 \\\text { Gross margin } & 4,755,595 & 3,983,971 \\\text { Operating expense } & 3,585,657 & 3,400,258\\\text { Operating income } & 1,169,938 & 583,713 \\\text { Interest expense } & 28,500 & 27,300 \\\text { Earnings before tax } & 1,141,438 & 556,413 \\\text { Income taxes } & 342,431 & 166,924\\\text { Net income }&\$799,007&\$389,489\end{array} Using horizontal analysis, how much is Cross, Inc.'s percentage change in accounts receivable from 2017 to 2018?


Definitions:

Bell Curve

A graphical representation of a normal distribution, showing how the likelihood of variables is highest near the mean and decreases symmetrically in both directions.

Frequency Distribution

A statistical analysis showing how often various values occur within a data set, often displayed in a table or graph.

Variance

A statistical measure that represents the spread or dispersion of a set of data points or investment returns from their mean.

Efficient Market

A market hypothesis stating that asset prices fully reflect all available information, making it impossible to consistently achieve higher returns.

Related Questions