The Goodberry Corporation data for the current year and prior year is as follows: What would a horizontal analysis report with respect to current assets?
A)Inventory turnover of 6.13 times
B)Current ratio of 2.62
C)A 30.00% increase in current assets
D)Current assets as 30.00% of total assets

Question

The Goodberry Corporation data for the current year and prior year is as follows:  What would a horizontal analysis report with respect to current assets?
A)Inventory turnover of 6.13 times 
B)Current ratio of 2.62 
C)A 30.00% increase in current assets 
D)Current assets as 30.00% of total assets

Quizplus · Accepted Answer

The horizontal analysis compares the current year data with the prior year data. If the current year data is 30% higher than the prior year data, then the horizontal analysis report would show a 30% increase in current assets. The other options (inventory turnover, current ratio, and current assets as a percentage of total assets) are not related to a horizontal analysis of current assets.

The Goodberry Corporation Data for the Current Year and Prior