Of it indicates the changing proportion of the it

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Unformatted text preview: es Do Do not show variation in various item from time to time time If it is not prepared on a consistent basis If comparative study will be misleading. comparative It does not establish any relationship It between items in profit and loss account with that of items of balance sheet with 16 3. Trend Analysis – overview 3. What is trend analysis? Advantages of trend analysis Disadvantages of trend analysis Example of trend analysis Comments derived from trend analysis. 17 What is Trend Analysis Also termed as trend percentage. Used Used for comparing financial statements over a number of years. over At least 3 years data required. Base Base year 18 Trend analysis Each base year item taken as 100. Upward Upward trend will be indicated by the trend % being more than 100. being Downward Downward trend % will be indicated by the trend% being less than 100. trend% 19 particulars 02 Rs. 02 % 03 Rs. 03 % 02 Rs. 04 % 4 100 7.2 180 10.2 255 4 4 100 100 3 3 75 75 2 2 50 50 Total capital employed 8 100 10.2 128 12,2 153 Application of funds. Fixed assets 1.6 Less: Depreciation prov. 0.6 100 100 2.4 0.9 150 150 3.2 1.5 200 250 Net fixed assets. 100 1.5 150 1.7 170 sources of funds 1)Net worth 2)Borrowed funds Debentures Total loan funds. 1 20 particulars 02 Rs. 02 % 03 Rs. 03 % 02 Rs. 04 % Working capital Working 1) Current assets 1) Quick assets Debtors Debtors Bank Total Q.A Total 4.5 1 5.5 100 100 100 5.4 0.8 6.2 120 80 113 7.2 1.1 8.3 160 110 151 3 1.5 4.5 10 3 7 100 100 100 100 100 100 3.6 2.2 5.8 12 3.3 8.7 120 147 129 120 110 124 4.2 1.9 6.1 14 3.9 10.5 140 127 136 144 130 150 Non quick assets Stock Staff advances Total non quick assets Total C.A less C. L Working cap...
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This document was uploaded on 02/09/2014.

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