If a balance sheet is subjected to vertical analysis which shows that current assets (using total assets as the base)have increased from 36% to 53%, this would always mean that:
A)the dollar amount of total assets has decreased.
B)the dollar amount of total assets has increased.
C)the dollar amount of current assets has increased.
D)current assets have increased as a percentage of total assets.

Question

Quizplus · Accepted Answer

When current assets are shown to have increased from 36% to 53% using total assets as the base, this means that current assets have increased as a percentage of total assets. It does not necessarily mean that the dollar amount of total assets has increased or decreased, nor does it provide information about the dollar amount of current assets.

If a Balance Sheet Is Subjected to Vertical Analysis Which