ACCT 23020 Lecture Notes - Lecture 42: Financial Statement, Regional Policy Of The European Union, Accounts Payable
3 Feb 2020
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Learning objective 1: perform an industry and company analysis. Understanding a company"s business and industry: need to see the big picture , every public company"s annual report filed with the. Trend percentages: a form of horizontal analysis, trends indicate the direction a business is taking, calculated using the following formula. The trend percentage is calculated by taking any year dollar amount divided by the base year dollar amount and then multiplying by. Vertical analysis: income statement: shows relationship of a financial-statement item to its base, base for income statement is net sales (can also be called sales revenue or similar) Vertical analysis percentage equals each income statement item divided by net sales revenue. Vertical analysis: balance sheet: shows relationship of a financial statement item to its base, base for balance sheet is total assets, vertical analysis % = each balance sheet item / Vertical analysis: common-size: all numbers on the financial statement are shown as percentages only.
