The Ranger Corporation data for the current year and prior year is as follows: What would a horizontal analysis report with respect to current assets show?
A)Inventory turnover of 9.02 times
B)Current ratio of 4.48.
C)A 27.99% increase in current assets
D)Current assets are 100.00% of total assets

Question

The Ranger Corporation data for the current year and prior year is as follows:  What would a horizontal analysis report with respect to current assets show?
A)Inventory turnover of 9.02 times 
B)Current ratio of 4.48. 
C)A 27.99% increase in current assets 
D)Current assets are 100.00% of total assets

Quizplus · Accepted Answer

A horizontal analysis report compares the financial statement items of the current year with the items of the prior year. Therefore, a horizontal analysis report with respect to current assets would show the percentage change in current assets from the prior year to the current year. Choice C states that there is a 27.99% increase in current assets, which is the correct answer. Choice A relates to the inventory turnover ratio and choice B relates to the current ratio, both of which are not related to the question asked. Choice D is incorrect as it states that current assets are 100% of total assets, which may not be true.

The Ranger Corporation Data for the Current Year and Prior