COMPARATIVE STATEMENT COMMON SIZE STATEMENT AND TREND ANALYSIS INTRODUCTION We know business is mainly concerned with the financial activities. In order to ascertain the financial status of the business every enterprise prepares certain statements‚ known as financial statements. Financial statements are mainly prepared for decision making purpose. But the information as is provided in the financial statements is not adequately helpful in drawing a meaningful conclusion. Thus‚ an effective analysis
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COMMON-SIZE FINANCIAL STATEMENT ANALYSIS When all the items of a financial statement are expressed on a common basis‚ it is known as a common-size financial statement. Common-sizing of balance sheet is done generally by expressing its all items as a percentage of its total assets or total equities. Similarly‚ income statement is common-sized when its all items are expressed as percentage of total sales. PROCEDURE OF COMMON SIZING In preparing common-size income statement‚ the following procedure
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Common-Size Analysis When comparing financial statements‚ it is often necessary to compare successive years ’ statements of the same company or statements from companies of various sizes. Ordinary financial statements can make it difficult to recognize trends or spot disproportionate categories since the figures make it difficult to tell how much a category has changed in relation to the other categories. Common-size statements solve this problem by valuing all categories in relation to a base
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Common Size Statements are used to compare financial statements of different-size companies‚ or of the same company over different periods. Common-size analysis - (also called vertical analysis) expresses each line item on a single year’s financial statement as a percent. The base amount for the balance sheet is usually total assets (which is the same number as total liabilities plus stockholders’ equity)‚ and for the income statement it is usually net sales or revenues. By comparing two or more
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Common-size Income Statement Analysis The common-size income statement shows that Coca-Cola’s cost of goods sold to revenues percentage rose very slightly from 39.14% in 2011 to 39.32% in 2013. At the same time‚ PepsiCo’s cost of goods sold to revenues percentage decreased from 47.51% in 2011 to 47.04% in 2013‚ bringing the 3-year-average to 47.44%. However‚ 47.44% is still much higher than Coca-Cola’s 3-year-average of 39.38%. With lower cost of goods sold to revenues ratio‚ Coca-Cola was able to
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The two documents that stirred up controversy during 1776 were The Declaration of Independence and Common Sense. These documents started to put the pressure against the government and it eventually led to the thirteen colonies gaining independence from Britain and the creation of a democratic society. In order for these documents to have the effect that they had on society it was crucial that the message be properly delivered. As much as these documents were connected and seem to help elevate the
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It is a well established fact that with increase in scale of output‚ efficiency increases up to an optimum point and this paper will put this to the test by investigating whether this holds true in the agriculture sector as well. 2. Problem statement Ideally‚ government policy should be directed towards increasing the capacity of the traditional agriculture sector in order to transform it towards a more modern one. However‚ with a weak local government structure‚ lack of strategic planning and
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I hear the loud yells coming from my dad’s voice. I see the tears rolling down my stepmom’s face as she screams and begs "Let go of me! ...Please just let go!" I would never forget that day. That day‚ were I held my one year old sister beside me‚ tears down her face‚ as I watched this beating that was being done with the hands of this man‚ who I was suppose to call "dad".These days were pretty "normal" for me as a child. From watching my dad and stepmom argue‚ to seeing a blunt being made right in front of me
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happiness. The meaning of Epicurus’ statement is that humanity’s decisions need to be inspired by the innate good of pleasure and should reflect a clear conscience. The first step is to comprehend the attractive pleasures that ease one’s soul and the negative indulgences one should avoid‚ which may diminish from it. When their foundation of what’s acceptable or not is formulated‚ one will make their own decisions from their unique basis on morality. From a “comparative measurement” one is able to access
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AYALA LAND‚ INC. vs DMCI HOLDINGS‚ INC. Comparative Financial Analysis Financial analysis is the best way the gauge the viability‚ stability and profitability of business. The ratios and analysis present us the key strengths and weaknesses of a certain company. Through this ratios and analysis‚ companies are able to maximize their key strengths and remedies if not eliminate their key weaknesses. Financial analysis and ratios aid stakeholders assess financial health of the companies. In light
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