Mother Nature Supplies
Following Are Selected Data from the Financial

question 46

Multiple Choice

Mother Nature Supplies
Following are selected data from the financial statements of Mother Nature Supplies:
​
$\begin{array}{lrr}&2018&2017\\\text { Accounts receivable } & \$ 60,000 & \$ 38,000 \\\text { Merchandise inventory } & 12,000 & 16,000 \\\text { Total assets } & 450,000 & 380,000 \\\text { Net sales } & 380,000 & 270,000 \\\text { Cost of goods sold } & 160,000 & 210,000\end{array}$ ​
-Refer to the data for Mother Nature Supplies.
Which of the following would result from a horizontal analysis of its balance sheet?

• A)Accounts receivable increased $22,000,or 57.9%,during 2018.
• B)Accounts receivable is five times larger than merchandise inventory in 2018.
• C)Accounts receivable is 13.3% of total assets for 2018.
• D)Merchandise inventory is 2.7% of total assets for 2018.

---

Definitions:

Gestalt Psychologists

Psychologists who focus on how people interpret the world and believe that the whole is greater than the sum of its parts.

Form Perception

The cognitive process of recognizing and understanding the shapes and structures of objects in one's environment.

Color Vision

The ability of the eye to distinguish objects based on the wavelengths of the light they reflect, emit, or transmit.

Lens

A transparent structure in the eye that focuses light on the retina to create clear images.