Which one of the following statements describes common size analysis: Common size analysis:
A)is an alternative term for horizontal analysis.
B)is a comparison of the financial statements of two or more companies of a similar size.
C)extends vertical analysis over more than one accounting period.
D)uses the figures related to a single accounting period only.

Question

Quizplus · Accepted Answer

Common size analysis extends vertical analysis over more than one accounting period, allowing for the comparison of financial statements across different periods by converting items to percentages of a common base.

Which One of the Following Statements Describes Common Size Analysis