Vertical analysis of financial statements refers to a comparison of amounts which are expressed in terms of a base amount that is from a:
A)previous time period.
B)financial summary.
C)specific amount that is on the same financial statement.
D)either previous time period or common size statement.
E)common size statement.

Question

Quizplus · Accepted Answer

Vertical analysis involves comparing line items within the same financial statement to a base figure on that statement, such as total assets on the balance sheet or sales on the income statement.

Vertical Analysis of Financial Statements Refers to a Comparison of Amounts