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CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 17-1LESSON 17-1
Trend Analysis and Component Percentages
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LESSON 17-1
RATIO ANALYSISRATIO ANALYSIS
Net IncomeNet Sales Stated Ratio÷ =
$2,000,000.00 ÷ = 10 times (10 to 1 or 10:1)
$200,000.00
The stated ratio means net sales is 10 times net income.
Net SalesNet Income Percentage Ratio÷ =
$200,000.00 ÷ = .10 or 10%$2,000,000.00
Net income is 10% of sales.
Net SalesNet Income Fractional Ratio÷ =
$200,000.00 ÷ = 1/10$2,000,000.00
Net income is one-tenth of net sales.
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LESSON 17-1
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TREND ANALYSIS ON THE TREND ANALYSIS ON THE INCOME STATEMENTINCOME STATEMENT
11 22 3344
Current Year Net Sales $4,767,200.00 11
– Prior Year Net Sales 3,633,000.00 22
÷ Prior Year Net Sales 3,633,000.00
= Increase or Decrease in Net Sales $1,134,200.00 33
= % Increase or Decrease in Net Sales 31.2% 44
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LESSON 17-1
TREND ANALYSIS ON THE STATEMENT TREND ANALYSIS ON THE STATEMENT OF STOCKHOLDERS’ EQUITYOF STOCKHOLDERS’ EQUITY page 497
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LESSON 17-1
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TREND ANALYSIS ON THE TREND ANALYSIS ON THE BALANCE SHEETBALANCE SHEET
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LESSON 17-1
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TREND ANALYSIS ON THE TREND ANALYSIS ON THE BALANCE SHEETBALANCE SHEET
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LESSON 17-1
page 499
COMPONENT PERCENTAGES ON COMPONENT PERCENTAGES ON THE INCOME STATEMENTTHE INCOME STATEMENT
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LESSON 17-1
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COMPONENT PERCENTAGES ON COMPONENT PERCENTAGES ON THE INCOME STATEMENTTHE INCOME STATEMENT
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LESSON 17-1
COMPONENT PERCENTAGES ON THE COMPONENT PERCENTAGES ON THE STATEMENT OF STOCKHOLDERS’ EQUITYSTATEMENT OF STOCKHOLDERS’ EQUITY page 500
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LESSON 17-1
page 501
COMPONENT PERCENTAGES ON COMPONENT PERCENTAGES ON THE BALANCE SHEETTHE BALANCE SHEET
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LESSON 17-1
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COMPONENT PERCENTAGES ON COMPONENT PERCENTAGES ON THE BALANCE SHEETTHE BALANCE SHEET
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LESSON 17-1
page 502TERMS REVIEWTERMS REVIEW
ratio trend analysis