Back Country Life, Inc., does business in two product segments, Camping and Fishing. The following annual revenue information was determined from the accounting system’s invoice information:
2014 2013
Camping $280,000 $240,000
Fishing 140,000 160,000
Total revenue $420,000 $400,000
Prepare a horizontal and vertical analysis of the segments. Round to one decimal place.
Answer:
Horizontal analysis:
2014 2013
Increase/(Decrease)
Amount Percent
Camping $280,000 $240,000 $ 40,000 16.7%
Fishing 140,000 160,000 (20,000) –12.5%
Total revenue $420,000 $400,000 $ 20,000 5.0%
Vertical analysis:
2014 2013
Amount Percent Amount Percent
Camping $280,000 66.7% $240,000 60.0%
Fishing 140,000 33.3% 160,000 40.0%
Total revenue $420,000 100.0% $400,000 100.0%