McHale Company does business in two customer segments, Retail and Wholesale

McHale Company does business in two customer segments, Retail and Wholesale. The following annual revenue information was determined from the accounting system’s invoice information:

20Y5 20Y4

Retail$126,000 $120,000

Wholesale150,000 164,000

Total revenues $276,000 $284,000

Prepare horizontal and vertical analyses of the segments. Round to one decimal place.

Answers:

Horizontal analysis: 20Y5 20Y4 Amount Percent Retail $126,000 $120,000 $ 6,000 5.0% Wholesale 150,000 164,000 (14,000) –8.5% Total revenues $276,000 $284,000 $ (8,000) –2.8% Vertical analysis: Amount Percent Amount Percent Retail $126,000 45.7% $120,000 42.3% Wholesale 150,000 54.3% 164,000 57.7% Total revenues $276,000 100.0% $284,000 100.0%