MANAGERIAL ACCOUNTING W/CONNECT
15th Edition
ISBN: 9781259732454
Author: Garrison
Publisher: MCGRAW-HILL CUSTOM PUBLISHING
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Question
Chapter 15, Problem 1Q
To determine
Analysis tools are used to analyze and interpret the financial statement data. There are many such techniques to compare the performance of the company like vertical analysis, horizontal analysis, ratio analysis, etc.
To Distinguish: Between horizontal and vertical analysis of financial statement.
Expert Solution & Answer
Explanation of Solution
Solution:
The points of difference between the two analysis methods are as follows:
| Horizontalmethod | Verticalmethod |
| In horizontal method, values of corresponding financial statement items of different periods are compared. | In Vertical method, the financial statement items are shown as a percentage of base items to make decisions. |
| It compares the changes in the corresponding value of items over a period. | It compares the change in the relative proportion of items in financial statements. |
| It is used to compare an organization’s current performance with its past performance. | It compares an organization’s performance with other organizations. |
Conclusion
Thus, there are differences between the horizontal and vertical analysis of financial statement.
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Students have asked these similar questions
Journalize these transactions, also post the transcations to T-accounts and determine month-end balances. Finally prepare a trail balance.
Suppose during 2023, BlueStar Shipping reported the following financial information (in
millions):
Net Sales: $40,000
Net Income: $150
Total Assets at Beginning of Year: $26,000
•
Total Assets at End of Year: $24,800
Calculate the following:
(a) Asset Turnover
(b) Return on Assets (ROA) as a percentage
Please fill all cells! I need help
Chapter 15 Solutions
MANAGERIAL ACCOUNTING W/CONNECT
Ch. 15 - Prob. 1QCh. 15 - What is the basic purpose for examining trends in...Ch. 15 - Prob. 3QCh. 15 - Prob. 4QCh. 15 - Prob. 5QCh. 15 - Prob. 6QCh. 15 - Prob. 7QCh. 15 - Prob. 8QCh. 15 - A company seeking a line of credit at a bank was...Ch. 15 - Prob. 1F15
Ch. 15 - Prob. 2F15Ch. 15 - Prob. 3F15Ch. 15 - Prob. 4F15Ch. 15 - Prob. 5F15Ch. 15 - Prob. 6F15Ch. 15 - Prob. 7F15Ch. 15 - Prob. 8F15Ch. 15 - Prob. 9F15Ch. 15 - Prob. 10F15Ch. 15 - Prob. 11F15Ch. 15 - Prob. 12F15Ch. 15 - Prob. 13F15Ch. 15 - Prob. 14F15Ch. 15 - Prob. 15F15Ch. 15 - Prob. 1ECh. 15 - Prob. 2ECh. 15 - Prob. 3ECh. 15 - Prob. 4ECh. 15 - Prob. 5ECh. 15 - Prob. 6ECh. 15 - Prob. 7ECh. 15 - Prob. 8ECh. 15 - Prob. 9ECh. 15 - Prob. 10ECh. 15 - Prob. 11ECh. 15 - Prob. 12ECh. 15 - Prob. 13PCh. 15 - Prob. 14PCh. 15 -
PROBLEM 15-15 Comprehensive Ratio Analysis...Ch. 15 - Prob. 16PCh. 15 - Prob. 17PCh. 15 - Prob. 18PCh. 15 - Prob. 19PCh. 15 - Prob. 20PCh. 15 - Prob. 21P
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