When performing vertical analysis the base amount for administrative expense is generally
A) administrative expense in a previous year.
B) net sales.
C) gross profit.
D) fixed assets.

Question

Quizplus · Accepted Answer

When performing vertical analysis, the base amount for each item is typically chosen as a percentage of net sales. Therefore, the base amount for administrative expense would be net sales.

When Performing Vertical Analysis the Base Amount for Administrative Expense