The following information is provided from EZ Electronics' annual report for the years ended December 31:

-Refer to the EZ Electronics annual report above.Using vertical analysis,2010 sales would be represented as ________.
A)100%
B)91%
C)83%
D)21%

Question

The following information is provided from EZ Electronics' annual report for the years ended December 31:

-Refer to the EZ Electronics annual report above.Using vertical analysis,2010 sales would be represented as ________.
A)100% 
B)91% 
C)83% 
D)21%

Quizplus · Accepted Answer

Vertical analysis is a technique used to analyze financial statements where each line item is expressed as a percentage of a base figure. In this case, the base figure is sales. The question asks specifically for the percentage representation of 2010 sales. From the given table, we can see that 2010 sales were $2,000,000. To determine the percentage representation, we divide 2010 sales by itself and then multiply by 100:

($2,000,000 ÷ $2,000,000) × 100 = 100%

Therefore, the best choice is A) 100%.

The Following Information Is Provided from EZ Electronics' Annual Report