Answer:
Trend Analysis helps to interpret the changes in account balances over certain period of time. Trends in percentages is presented in the table below.
* Excel solution is attached for your reference.
Explanation:
For Rotorua Product Ltd, data trends (in percentages) can be computed using the following formula:
Trend in % = (Current Year ÷ Base Year) × 100
where: Base Year is assumed to be Year 1
Year 1 Year 2 Year 3 Year 4 Year 5
Sales 100.0% 107.9% 112.0% 121.0% 127.7%
Current Assets
Cash 100.0% 132.5% 112.6% 90.1% 95.4%
Accounts receivable, net 100.0% 102.9% 107.1% 119.7% 136.8%
Inventory 100.0% 108.3% 104.2% 109.9% 113.6%
Total current assets 100.0% 108.1% 105.6% 111.8% 119.9%
Current liabilities 100.0% 108.5% 103.7% 105.5% 128.0%
The expression of the assets, liabilities, and sales data of Rotorua Products, Ltd., in trend percentages is as follows:
Year 1 Year 2 Year 3 Year 4 Year 5
Sales 100% 107.9% 112.0% 121.0% 127.7%
Cash 100% 132.5% 112.6% 90.1% 95.4%
Accounts receivable, net 100% 102.9% 107.1% 119.7% 136.8%
Inventory 100% 108.3% 104.2% 109.9% 113.6%
Current assets 100% 108.1% 105.6% 111.8% 119.9%
Current liabilities 100% 108.5% 103.7% 105.5% 128.0%
Data and Calculations:
Year 1 Year 2 Year 3 Year 4 Year 5
Sales $4,539,770 $4,898,400 $5,083,390 $5,492,990 $5,796,610
Cash $80,701 $106,917 $90,847 $72,725 $76,958
Accounts
receivable, net 418,624 430,931 448,168 501,061 572,699
Inventory 800,711 867,178 834,459 880,216 909,440
Current assets $1,300,036 $1,405,026 $1,373,474 $1,454,002 $1,559,097
Current liabilities $316,539 $343,508 $328,340 $333,975 $405,136
Thus, each year's data is divided by Year 1 data, and then the result is multiplied by 100 to obtain the trend percentages.
Learn more: https://brainly.com/question/16253902
