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Prepare a vertical analysis of both the balance sheets and income statements for Year 4 and Year 3.

a. Prepare a vertical analysis of the balance sheets for Year 4 and Year 3. Note: Percentages may not add exactly due to rounding. Round your answers to 2 decimal places. (i.e., .2345 should be entered as 23.45).

FINCH COMPANY Vertical Analysis of Balance Sheets Year 4 Year 3 Amount Percentage of Total Amount Percentage of Total Assets Current assets Cash $16,800 % $13,500 % Marketable securities 20,300 7,500 Accounts receivable (net) 54,700 46,400 Inventories 135,500 144,300 Prepaid items 25,600 11,300 Total current assets 252,900 223,000 Investments 28,000 20,500 Plant (net) 270,900 255,200 Land 30,900 24,100 Total long-term assets 329,800 299,800 Total assets $582,700 $522,800 Liabilities and stockholders' equity Liabilities Current liabilities Notes payable $16,000 $4,900 Accounts payable 112,400 99,400 Salaries payable 19,400 15,000 Total current liabilities 147,800 119,300 Noncurrent liabilities Bonds payable 98,700 98,700 Other 31,900 26,300 Total noncurrent liabilities 130,600 125,000 Total liabilities 278,400 244,300 Stockholders' equity Preferred stock (par value $10, 4% cumulative, nonparticipating; 7,300 shares authorized and issued) 73,000 73,000 Common stock (no par; 50,000 shares authorized; 10,000 shares issued) 73,000 73,000 Retained earnings 158,300 132,500 Total stockholders' equity 304,300 278,500 Total liabilities and stockholders equity $582,700 % $522,800 %

b. Prepare a vertical analysis of the income statements for Year 4 and Year 3. Note: Percentages may not add exactly due to rounding. Round your answers to 2 decimal places. (i.e., .2345 should be entered as 23.45).

FINCH COMPANY Vertical Analysis of Income Statements Year 4 Year 3 Amount Percentage of Total Amount Percentage of Total Revenues Sales (net) $230,500 % $211,400 % Other revenues 9,200 6,300 Total revenues 239,700 217,700 Expenses Cost of goods sold 119,700 101,200 Selling, general, and administrative expense 54,000 48,400 Interest expense 7,000 6,200 Income tax expense 22,900 21,900 Total expenses 203,600 177,700 Net income $36,100 % $40,000 %

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