ACCOUNTING PRINCIPLES 122 5/16 >C<
ACCOUNTING PRINCIPLES 122 5/16 >C<
17th Edition
ISBN: 9781323461471
Author: Horngren
Publisher: PEARSON C
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Chapter 17, Problem 5RQ
To determine

Vertical Analysis: It is also known as common size analysis measures each item in the financial statement as a percentage of the base value of that particular statement.

It measures the relative changes in the value of a particular item over a period. Any alarming shift in the trend triggers a need to analyze the reason behind the shift.

To Explain: The meaning of vertical analysis and the item to be used as base in case of income statement and balance sheet

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ACCOUNTING PRINCIPLES 122 5/16 >C<

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