BUS-A 100 Chapter Notes - Chapter financial ratios: Current Liability, Income Statement, Retained Earnings
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BUS-A 100 Full Course Notes
Verified Note
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Document Summary
Understand analyzing nancial statements across time. compared this year to previous years shows trends and gives reader understanding about intentions and effectiveness of management. Understand analyzing nancial statements with industry averages. help show what competitors are doing about similar challenges purchasing vs. leasing major assets, nancing methods, gross pro t, dividends. Common-size means percentages were included, makes it easier to compare within industry usually balance sheet and income statement are made common size. Balance sheet - assets set at 100%, then all other accounts have their % of the whole listed next to their dollar amount. To do this, divide balance of cash by total assets. One important percentage is the % of current assets to total assets. % of all individual assets should add to 100% Since liabilities + equity = assets, the sum of these two also =100% An important % here is the % of total liabilities are to total liabilities.
