Which approach converts financial statement numbers as percentage of total assets or total sales?
A)Horizontal Analysis
B)Vertical Analysis
C)Ratio Analysis
D)Variance Analysis

Question

Quizplus · Accepted Answer

Vertical analysis, also known as common-size analysis, converts financial statement numbers as a percentage of total assets or total sales. This makes it easier to compare the financial performance of a company over time or against its competitors, as it shows the relative importance of each item in the financial statements.

Which Approach Converts Financial Statement Numbers as Percentage of Total