VI.

Horizontal and Vertical Analysis

HORIZONTAL ANALYSIS

WED Company

Projected Statement of Comprehensive Income

For the years ending December 31, 2020-2022

Increase/ (Decrease)

2022-2021 2021-2020

2022 2021 2020 Amount % Amount %

Gross Sales ₱ 6,399,984 ₱ 5,599,986 ₱ 4,799,988 ₱ 799,998.00 14.30% ₱ 799,998.00 14.30%

Less: COGS ₱ 1,397,926 ₱ 1,257,100 ₱ 1,127,770.00 ₱ 140,826.00 11.20% ₱ 129,330.00 11.47%
Gross Profit ₱ 5,002,058.00 ₱ 4,342,886.00 ₱ 3,672,218.00 ₱ 659,172.00 15.18% ₱ 670,668.00 18.26%
Less:
Expenses
Deprecia
tion ₱ 17,451.46 ₱ 17,451.46 ₱ 17,451.46 -0- -0- -0- -0-
Expense
Rent ₱ 108,000.00 ₱ 108,000.00 ₱ 108,000.00 -0- -0- -0- -0-
Expense
Salaries ₱ 1,848,000.00 ₱ 1,848,000.00 ₱ 1,848,000.00 -0- -0- -0- -0-
Expense
Utilities ₱ 20,599.92 ₱ 20,196.00 ₱ 19,800.00 ₱ 403.92 2% ₱ 396.00 2%
Expense
Pre-Operating -0- -0- -0- -0- -0- -0- -0-
Expense
Total ( ₱ 1,993,251.46
( ₱ 1,994,051.38) ( ₱ 1,993,647.46) ¿403.92) (0.02%) ( ₱ 396.00) (0.02%)
Expenses )

Net income ₱ 3,008,007.08 ₱ 2,349,238.00 ₱ 1,678,966.54 ₱ 658,769.08 28.04% ₱ 670,271.46 39.92%

WED Company

Projected Statement of Financial Position

For the years ending December 31, 2020-2022

Increase/ (Decrease)

2022-2021 2021-2020

2022 2021 2020 Amount % Amount %

Assets
Current
Assets
Cash in ₱ 10,973,699 ₱ 7,948,240.46 ₱ 5,581,551 ₱ 3,025,458.54 38.06% ₱ 2,366,689.46 42.40%
Bank
Total Current ₱ 10,973,699 ₱ 7,948,240.46 ₱ 5,581,551 ₱ 3,025,458.54 38.06% ₱ 2,366,689.46 42.40%
Assets

Non-Current
Assets
Machinery and ₱ 12,970 ₱ 12,970 ₱ 12,970 -0- -0- -0- -0-
Equipment
Furniture and
₱ 61,822 ₱ 61,822 ₱ 61,822
Fixtures
Accumulated ( ₱ 52,354.38) ( ₱ 34,902.92) ( ₱ 17,451.46) (₱ 17,451.46) (50%) (₱ 17,451.46) (100%)
Depreciation
Total Non-
₱ 22,437.62 ₱ 39,889.08 ₱ 57,340.54 (30.43%
Current (₱ 17,451.46) (44%) (₱ 17,451.46)
)
Assets

Total Assets ₱ 10,996,136.6 ₱ 7,988,129.54 ₱ 5,638,891.54 ₱ 3,008,007.06 37.66% ₱ 2,349,238.00 41.70%

Liabilities -0- -0- -0- -0- -0- -0- -0-

Owner’s
Equity
Andeza, ₱ 7,988,129.54 ₱ 5,638,891.54 ₱ 3,959,925 ₱ 2,349,238.00 41.70% ₱ 1,678,966.54 42.40%
Capital
₱
Net Income ₱ 2,349,238.00 ₱ 1,678,966.54 ₱ 658,769.08 28.04% ₱ 670,271.46 39.92%
3,008,007.08
Total ₱ 10,996,136.6 ₱ 7,988,129.54 ₱ 5,638,891.54 ₱ 3,008,007.06 37.66% ₱ 2,349,238.00 41.70%
Liabilities and
Owner’s
Equity

VERTICAL ANALYSIS

WED Company

Projected Statement of Comprehensive Income

For the years ending December 31, 2020-2022

2022 % 2021 % 2020 %

Gross Sales ₱ 6,399,984 100% ₱ 5,599,986 100% ₱ 4,799,988 100%

Less: COGS ₱ 1,397,926 21.84% ₱ 1,257,100 22.45% ₱ 1,127,770. 23.5%
Gross Profit ₱ 5,002,058.00 78.16% ₱ 4,342,886.00 77.55% ₱ 3,672,218.00 76.5%
Less:
Expenses
Depreciati
on ₱ 17,451.46 0.27% ₱ 17,451.46 0.31% ₱ 17,451.46 0.36%
Expense
Rent ₱ 108,000.00 ₱ 108,000.00 ₱ 108,000.00
1.69% 1.93% 2.25%
Expense
Salaries ₱ 1,848,000.00 ₱ 1,848,000.00 ₱ 1,848,000.00
28.88% 33% 38.50%
Expense
Utilities ₱ 20,599.92 ₱ 20,196.00 ₱ 19,800.00
0.32% 0.36% 0.41%
Expense
Pre-Operating -0- -0- -0- -0- -0- -0-
Expense
Total ( ₱ 1,994,051.38) (31.16%) ( ₱ 1,993,647.46) (35.60%) ( ₱ 1,993,251.46) (41.53%)
Expenses

Net income ₱ 3,008,007.08 47% ₱ 2,349,238.00 41.95% ₱ 1,678,966.54 34.98%

WED Company

Projected Statement of Financial Position

For the years ending December 31, 2020-2022

2022 % 2021 % 2020 %

Assets
Current
Assets
Cash in ₱ 10,973,699 ₱ 7,948,240.46 ₱ 5,581,551
99.80% 99.50% 98.98%
Bank
Total Current ₱ 10,973,699 ₱ 7,948,240.46 ₱ 5,581,551
99.80% 99.50% 98.98%
Assets

Non-Current
Assets
Machinery and ₱ 12,970 ₱ 12,970 ₱ 12,970
0.12% 0.16% 0.23%
Equipment
Furniture and
₱ 61,822 0.56% ₱ 61,822 3.11% ₱ 61,822 1.10%
Fixtures
Accumulated ( ₱ 52,354.38) (0.48%) ( ₱ 34,902.92) (0.44%) ( ₱ 17,451.46) 0.31%
Depreciation
Total Non-
Current ₱ 22,437.62 0.20% ₱ 39,889.08 0.50% ₱ 57,340.54 1.02%
Assets

Total Assets ₱ 10,996,136.6 100% ₱ 7,988,129.54 100% ₱ 5,638,891.54 100%

Liabilities -0- -0- -0- -0- -0- -0-

Owner’s
Equity
Andeza, ₱ 7,988,129.54 ₱ 5,638,891.54 ₱ 3,959,925
72.64% 70.60% 70.23%
Capital
Retained ₱ 3,008,007.08 ₱ 2,349,238.00 ₱ 1,678,966.54
27.36% 29.41% 29.77%
Earnings
Total Liabilities
and Owner’s ₱ 10,996,136.6 100% ₱ 7,988,129.54 100% ₱ 5,638,891.54 100%
Equity

V. Ratio Analysis
 Formula 2020 2021 2022
₱ 1,678,966.54 ₱ 2,349,238.00 ₱ 3,008,007.08
¿ ¿ ¿
Return On Net Income ₱ 5,638,891.54 ₱ 7,988,129.54 ₱ 10,996,136.60
¿
Investments Total Assets
=0.30 or 30% =0.21 or 21% =0.15 or 15%

To compute the Return on Investment (ROI), we used the formula that is being presented in the table above. ROI is

the ratio between net profit and cost of investment which determines if the company is gaining more profit than its cost.

Year 2020 Year 2021 Year 2022

For the year 2020, the company has a For this year, the company’s net For the year 2022, the company’s net

net income of Php 1,678,966.54 income is Php 2,349,238.00 and is income went high totaling to Php

divided by the total assets of the same divided to Php 7,988,129.54, which 3,008,007.08 and is then divided to the

year which is Php 5,638,891.54, it resulted to 0.21 or 21%. total asset for the year, which is Php

resulted to 0.30 or 30%. 10,996,136.60 and has a result of 0.15

or 15%.
 This only indicates that for the three consecutive years, the percentage which reflects the profitability of the WED

Company went higher in just three years. By that, it really shows that the company earns a raise of its profit than its costs,

which really show how effective and efficient the company is in terms of running the business.

VI. Breakeven Analysis

Fixed Cost

2020 2021 2022

Depreciation
₱ 17,451.46 ₱ 17,451.46 ₱ 17,451.46
Expense
Rent
₱ 108,000.00 ₱ 108,000.00 ₱ 108,000.00
Expense
Salaries and Wages
₱ 2,388,000.00 ₱ 2,388,000.00 ₱ 2,388,000.00
Expense
Depreciation
₱ 17,451.46 ₱ 17,451.46 ₱ 17,451.46
Expense
TOTAL ₱ 2,687,961.92 ₱ 2,687,961.92 ₱ 2,687,961.92

Variable Cost
 2020 2021 2022

Raw Materials ₱ 574,800.00 ₱ 704,130.00 ₱ 844,956.00

Utilities Expense ₱ 19,800.00 ₱ 20,196.00 ₱ 20,599.92

Machinery and Equipment ₱ 12,970.00 ₱ 12,970.00 ₱ 12,970.00

TOTAL ₱ 607,570.00 ₱ 737,296.00 ₱ 878,525.92

Sales per Unit = Php3,999.99

Computation:

Formula 2020 2021 2022

₱ 2,687,961.92 ₱ 2,687,961.92 ₱ 2,687,961.92
¿ ¿ ¿
Break-Even Points ¿ Cost (Php 3,999.99−¿ Php 506.31)
(Php 3,999.99−¿ Php 526.64)
(Php 3,999.99−¿ Php 549.08)
¿
in Units (Sales per Unit −¿ Variable Cost per Unit )
=769 =774 =779
₱ 2,687,961.92 ₱ 2,687,961.92 ₱ 2,687,961.92
¿ ¿ ¿
Break-Even Points ¿ Cost 0.87 0.87 0.87
¿
in Peso Contribution Margin
=Php3,081,611.40 =Php3,081,611.40 =Php3,081,611.40