If $2,500 is deposited in a savings account at the end of each year and the account pays interest of 5% compounded annually, what will be the balance of the account at the end of 10 years

The answers have been provided below

Explanation:

a. A comparative income statement with horizontal analysis for the two-year period, while using 20Y1 as the base year have been analysed and attached. In the picture attached, the increase or decrease in the amount was gotten from the year 20Y2 and 20Y1.

For example for sales,

Sales 20Y2 = $16,800,000.00

Sales 20Y1 = $15,000,000.00

Amount = $16,800,000.00 - $15,000,000.00 = $1,800,000

Percentage increase = ($1,800,000 ÷ $15,000,000)× 100 = 12%

The same method was applicable to every other figures.

b. We can see that the sales for year 20y2 rose by 12% even though the net income has a negative value of -5.8%.

We can see that there is also a rise in operating expenses of the firm at a higher rate than the increase in the sales rate of the company. The income from operation also reduced by 7.6%. These are some of the reasons which led to the negative net income.