Question

E12.7 Prepare horizontal and vertical analyses. LO2, 3 The statement of financial position for Bondi Ltd is presented below. BONDI LTD Statement of financial position as at 30 June 2020 2019 2020 ASSETS Current assets $ 88 000 $ 80 000 Property, plant and equipment (net) 81 000 90000 Intangibles 31 000 40 000 $200 000 $210 000 Total assets LIABILITIES AND EQUITY 52000 $48000 Current liabilities Non-current liabilities 135 000 150 000 Equity 13 000 12 000 Total liabilities and equity $200 000 $210 000 Required a. Prepare a horizontal analysis of the statement of financial position data for Bondi Ltd using 2019 as a base. Show the amount of increase or decrease as well. b. Prepare a vertical analysis for Bondi Ltd for 2019 and 2020

Answer 1

Ans. A	BONDI LTD
	Horizontal Statement of Financial Position
	June 30, 2019 & 2020
				Increase or (decrease)
		2020	2019	Amount	Percentage
	ASSETS
	Current Assets	$88,000	$80,000	$8,000	10.00%
	Property, plant and equipment (net)	$81,000	$90,000	-$9,000	-10.00%
	Intangibles	$31,000	$40,000	-$9,000	-22.50%
	Total assets	$200,000	$210,000	-$10,000	-4.76%
	LIABILITIES AND EQUITY
	Current Liabilities	$52,000	$48,000	$4,000	8.33%
	Non current liabilities	$135,000	$150,000	-$15,000	-10.00%
	Equity	$13,000	$12,000	$1,000	8.33%
	Total liabilities and equity	$200,000	$210,000	-$10,000	-4.76%
	Change in amount = Particular amount of current year 2020 - Particular amount of previous year 2019
	Change in percentage = Change in amount / particular amount of base or previous year * 100
Ans. B	BONDI LTD
	Vertical Statement of Financial Position
	June 30, 2019 & 2020
		2020	Percentage	2019	Percentage
	ASSETS
	Current Assets	$88,000	44.00%	$80,000	38.10%
	Property, plant and equipment (net)	$81,000	40.50%	$90,000	42.86%
	Intangibles	$31,000	15.50%	$40,000	19.05%
	Total assets	$200,000	100.00%	$210,000	100.00%
	LIABILITIES AND EQUITY
	Current Liabilities	$52,000	26.00%	$48,000	22.86%
	Non current liabilities	$135,000	67.50%	$150,000	71.43%
	Equity	$13,000	6.50%	$12,000	5.71%
	Total liabilities and equity	$200,000	100.00%	$210,000	100.00%
	Amount is percentage from assets side =   Particular amount from assets side / Total assets * 100
	Amount is percentage from liabilities side =   Particular amount from liability side / Total liabilities and owner's equity * 100