Question

Horizontal Analysis Total assets were $1,000,000 in 2019, $900,000 in 2018, and $950,000 in 2017. What was the percentage change from 2017 to 2018 and from 2018 to 2019? Was the change an increase or a decrease? Use a negative sign with your answer(s) to reflect if the change is was a decrease. Round answers to one decimal place. Ex: 0.2345 = 23.5%

Answer 1

Answer:

(a) Decreases by 5.3%.

(b) Increases by 11%.

Explanation:

Given that,

Total assets in 2019 = $1,000,000

Total assets in 2018 = $900,000

Total assets in 2017 = $950,000

Percentage change from 2017 to 2018:

= [(Total assets in 2018 - Total assets in 2017) ÷ Total assets in 2017] × 100

= [($900,000 - $950,000) ÷ $950,000] × 100

= (-$50,000 ÷ $950,000) × 100

= -0.053

= -5.3%

Therefore, the total assets from 2017 to 2018 decreases by 5.3 percent.

Percentage change from 2018 to 2019:

= [(Total assets in 2019 - Total assets in 2018) ÷ Total assets in 2018] × 100

= [($1,000,000 - $900,000) ÷ $900,000] × 100

= ($100,000 ÷ $900,000) × 100

= 0.11

= 11%

Therefore, the total assets from 2018 to 2019 increases by 11 percent.