Question

Vertical Analysis of Balance Sheet

Balance sheet data for Alvarez Company on December 31, the end of two recent fiscal years, follows:

	Current Year		Previous Year
Current assets	$296,100		$184,150
Property, plant, and equipment	431,460		387,350
Intangible assets	118,440		63,500
Current liabilities	160,740		76,200
Long-term liabilities	355,320		292,100
Common stock	76,140		82,550
Retained earnings	253,800		184,150

Prepare a comparative balance sheet for both years, stating each asset as a percent of total assets and each liability and stockholders' equity item as a percent of the total liabilities and stockholders' equity. If required, round percentages to one decimal place.

Alvaraz Company
Comparative Balance Sheet
For the Years Ended December 31
	Current year Amount	Current year Percent	Previous year Amount	Previous year Percent
Current assets	$296,100	%	$184,150	%
Property, plant, and equipment	431,460	%	387,350	%
Intangible assets	118,440	%	63,500	%
Total assets	$846,000	%	$635,000	%
Current liabilities	$160,740	%	$76,200	%
Long-term liabilities	355,320	%	292,100	%
Common stock	76,140	%	82,550	%
Retained earnings	253,800	%	184,150	%
Total liabilities and stockholders' equity	$846,000	%	$635,000	%

Answer 1

Alvaraz Company
Comparative Balance Sheet
For the Years Ended December 31
	Current	Current	Previous	Previous
	year	year	year	year
	Amount	Percent	Amount	Percent
Current assets	$296,100	35.0%	$184,150	29.0%
Property, plant, and equipment	431,460	51.0%	387,350	61.0%
Intangible assets	118,440	14.0%	63,500	10.0%
Total assets	$846,000	100.0%	$635,000	100.0%
Current liabilities	$160,740	19.0%	$76,200	12.0%
Long-term liabilities	355,320	42.0%	292,100	46.0%
Common stock	76,140	9.0%	82,550	13.0%
Retained earnings	253,800	30.0%	184,150	29.0%
Total liabilities and stockholders' equity	$846,000	100.0%	$635,000	100.0%

Working notes for the above answer is as under

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