WorksheetsQuiz on FS Analysis (May 5-8, 2025)
Total questions: 20
Worksheet time: 18mins
Which of these statements is FALSE?
Horizontal analysis can show peso and percentage changes over time.
Vertical analysis shows each item as a percentage of a base item.
Trend analysis uses a base year as 100%.
A company comparison should not be made with industry averages if the company does not clearly fit into any one industry
The percent of property, plant and equipment to total assets is an example of:
vertical analysis
horizontal analysis
ratio analysis
liquidity analysis
The percentage analysis of increases and decreases in individual items in comparative financial statements is called:
vertical analysis
trend analysis
ratio analysis
horizontal analysis
In performing a vertical analysis, the base for prepaid expenses is
total current assets.
total liabilities.
total assets.
prepaid expenses in the previous year.
In performing a vertical analysis, the base for cost of goods sold is
Total sales revenue
Gross profit
Net income
Average sales
In performing a horizontal analysis, the base amount is:
This year’s balance
Last year’s balance
Difference of this year and last year’s balances
Average of this year and last year’s balances
The following can be used as a base amount in performing a vertical analysis EXCEPT:
Total liabilities and equity
Sales revenue
Total assets
Net income
In performing a trend analysis, the base year is always?
<100%
>100%
100%
0
Statements in which all items are expressed only in relative terms (percentages of a base) are termed:
Financial Statements
Vertical Statements
Horizontal Statements
Common-Size Statements
In performing a vertical analysis, the base for unearned revenue is
total assets
total liabilities
total revenue
net income
The percentage analysis of increases and decreases in individual items in comparative financial statements is called:
vertical analysis
profitability analysis
solvency analysis
horizontal analysis
Horizontal analysis is also known as
linear analysis
trend analysis
vertical analysis
common size analysis
In a vertical analysis of a balance sheet, which item is usually used as the base amount?
Total assets
Total liabilities
Stockholders' equity
Net income
Which of the following best describes vertical analysis?
Analyzing financial data over time
Expressing each line item as a percentage of a base amount
Comparing financial ratios to industry averages
Evaluating the growth of revenue over several years
What does horizontal analysis primarily examine?
Relationships between line items in a single period
Changes in financial data over multiple periods
Growth trends in financial statements
Comparison of financial data to industry standards
Problem Alert, please provide your solution. “Vote Corp. had net income of P2 million in 2021. Using the 2021 financial elements as the base data, net income decreased by 70 percent in 2022 and increased by 175 percent in 2023. The respective net income reported by Robin Corp. for 2022 and 2023 are:”
P 600,000 and P5,500,000
P1,400,000 and P3,500,000
P5,500,000 and P 600,000
P1,400,000 and P5,500,000
Problem Alert, please provide your solution. “Assume that Subic Inc. reported a net loss of P50,000 in 2023 and net income of P250,000 in 2024. The increase in net income of P300,000:”
can be stated as 0%
cannot be stated as a percentage
can be stated as 100% increase
can be stated as 200% increase
Problem Alert, please provide your solution. “A company’s net income was P100,000 in Year 1 and P150,000 in Year 2. What is Year 3 net income if trend percentage is 110% with Year 1 as the base year?”
P100,000
P150,000
P110,000
P165,000
Problem Alert, please provide your solution. “Given the following, compute the company’s gross margin ratio. Sales- P1,500,000 Purchases- P500,000 Inventory, beginning- P10,000 Inventory, ending- P80,000 GSAE- P230,000”
66.67%
56%
28.67%
71.33%
Problem Alert, please provide your solution. “Gapo Corp. had net income of P2 million in 2021. Using the 2021 financial elements as the base data, net income decreased by 30 percent in 2022 and increased by 75 percent in 2023. The respective net income reported by Robin Corp. for 2022 and 2023 are:”
P 600,000 and P5,500,000
P1,400,000 and P3,500,000
P5,500,000 and P 600,000
P1,400,000 and P5,500,000
