To apply a vertical analysis to the balance sheet, the base amount usually selected is:
A)either total liabilities or total shareholders' equity.
B)total revenues.
C)total assets.
D)total liabilities.
E)total shareholders' equity.

Question

Quizplus · Accepted Answer

In a vertical analysis of the balance sheet, the base amount typically used is total assets. This approach involves expressing each item on the balance sheet as a percentage of total assets to assess the relative size and financial composition of the company.

To Apply a Vertical Analysis to the Balance Sheet, the Base