Which of the following is typically used as the base in a vertical analysis of a balance sheet?
A)Total liabilities
B)Total stockholders' equity
C)Total assets
D)Net sales

Question

Quizplus · Accepted Answer

Total assets are typically used as the base in a vertical analysis of a balance sheet because it represents the entire value of the company's resources and is the foundation of the financial statement. Vertical analysis involves expressing each balance sheet item as a percentage of total assets, allowing for better comparison of the relative importance of each item.

Which of the Following Is Typically Used as the Base