Question

Exercise 13-05 

Hypothetical balance sheets of Nike, Inc. are presented here. 

NIKE, INC.  Condensed Balance Sheet May 31 ($ in millions) 

(a) Prepare a horizontal analysis of the balance sheet data for Nike, using 2021 as a base. (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 1 decimal place, e.g. 12.5%) 

NIKE, INC. Condensed Balance Sheet May 31 ($ in millions) 

(b) Prepare a vertical analysis of the balance sheet data for Nike for 2022. 

NIKE, INC. Condensed Balance Sheet

Answer 1

Ans. 1	NIKE INC.
	Condensed Balance Sheet
	For the Month Ended May 31, 2022 and 2021
		2022	2021	Amount change	Percentage change
	Assets
	Current assets	$9,600	$8,790	$810	9.2%
	Property, plant and equipment	$1,810	$1,800	$10	0.6%
	Other assets	$1,580	$1,710	-$130	-7.6%
	Total assets	$12,990	$12,300	$690	5.6%
	Liabilities and Owner's Equity
	Current liabilities	$3,170	$3,300	-$130	-3.9%
	Long term liabilities	$1,230	$1,390	-$160	-11.5%
	Stockholder's equity	$8,590	$7,610	$980	12.9%
	Total Liabilities and stockholder's equity	$12,990	$12,300	$690	5.6%
	Change in amount = Particular amount of current year 2022 - Particular amount of previous year 2021
	Change in percentage = Change in amount / particular amount of base (2021) or previous year * 100
Ans. 2	NIKE INC.
	Condensed Balance Sheet
	For the Month Ended May 31, 2022
		in millions	Percent
	Assets
	Current assets	$9,600	73.9%
	Property, plant and equipment	$1,810	13.9%
	Other assets	$1,580	12.2%
	Total assets	$12,990	100.0%
	Liabilities and Owner's Equity
	Current liabilities	$3,170	24.4%
	Long term liabilities	$1,230	9.5%
	Stockholder's equity	$8,590	66.1%
	Total Liabilities and stockholder's equity	$12,990	100.0%
	*Calculations for Common Size Balance Sheet:
	Amount is percentage from assets side (2022) =   Particular amount from assets side (2022) / Total assets (2022) * 100
	Amount is percentage from liabilities side (2022) =   Particular amount from liability side (2022)/ Total liabilities and owner's equity (2022) * 100

Answer 2

a) NIKE, INCI Condensed Balance sheet May 31 ($ in millions) Increase 2022 2021 (Decrease) Percentage change from 2021 9.2 % $810 $ 10 $(130) $690 0.6 % (7.6% 5:6 % Asets Current Assets $ 9,600 $8,790 Property, plant & equipment(net) $1,810 $1,800 Other assets $1,580 & 1,710 Total assets $12,990 $12,300 Liabilities and Stock- holders' Equity Current Liabilities $3,150 $3,300 Long term habilities $1,230 $1,390 Stockholders equity $8,590 $7,610 Todal liabilities and stockholders' equity $12,990 $ 12,300 $(130) $ (160) (3.99% (11.5 % $ 980 $690 12.9% in ago $ 12,300 $690 5.6% Calculation. Increase (Decrease) = This year Amount - Previous year Amount $ 9, 600 - $8,790 = $810 Increase (Decrease) in Current Assets = Increase (Decrease) in Property, plant & equipment (net) - $ 1,810 - $1,800 = $10

Percentage change - & 100 Increase (Decrease) Base Year Amount X100 Current assets = $810 x 100 $8,790 = 9.22% Property, plant and equipment, net = 8 10 x 100 $1,800 = 0.56%

1 bi NIKE INC. Condensed Balance sheet for the year Ended 2002 $ (in millions) Percent Assets Current Assets $9,600 73. go% Property, plant and equipment (net) $1,810 13.93% Other assets $ 1580 12:16 % Total assets $ 12,990 100.00% Liabilities and stockholders' Equity Current liabilities $3,170 L 24.40%. Long term Liabilities $ 1,230 9.47% Stockholders' equity $8,590 66.13% Total liabilities and stockholders equity $12, 990 100.00% Totien: percent = Item Amount – Total assets) x 100 ent assets = ($9,600 - $ 12,990) x 100 = 73.907 ity, plant & equipment (net) = ($1,010 - $ 12,990)x100 2) 13. 93%

Answer 3

a)     Condensed balance sheet may 31 ($ in million )
				2022	2021	increase (decrease)	percentage change from 2016
Assets
current assets				9600	8790	810	9.2%
property plant & equipment net				1810	1800	10	0.6%
other assets				1580	1710	-130	-7.6%
total assets				12990	12300	690	5.6%
liabilities & stockholders equity
current liabilities				3170	3300	-130	-3.9%
long term liabilities				1230	1390	-160	-11.5%
stockholder's equity				8590	7610	980	12.9%
Total liabilities & stockholders equity				12990	12300	690	5.6%
b) vertical analysis of the balance sheet data for nike
condensed balance sheet
				$ in million	percent
assets
current assets				9600	73.9%
property plant & equipment net				1810	13.9%
other assets				1580	12.2%
total assets				12990	100.0%
liabilities & stockholders equity
current liabilities				3170	24.4%
long term liabilities				1230	9.5%
stockholder's equity				8590	66.1%
Total liabilities & stockholders equity				12990	100.0%

please give a thumbs up if it is helpful & let me know if any doubt