ACCT - Chapter 13 - Alex Fish ACCT042 Chapter 13...

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Alex Fish ACCT042 – Chapter 13 Information Overload – If you are given too much information that the important information is obscured Horizontal Analysis: also called trend analysis, refers to studying the behavior of individual financial statement items over several accounting periods Absolute amounts: used to compare how amounts change over time Materiality: how important a piece of information is Percentage Analysis: expressing a relationship of two items as a percentage, almost always is expressed as a balance of the previous item Vertical Analysis: uses percentages to compare individual components of financial statements to a key statement figure. Ratio Analysis: involves studying various relationships between different items reported in a set of financial statements. Measures of Debt Paying Ability Liquidity Ratios: indicates a company’s ability to pay short term debts. o
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This note was uploaded on 05/31/2010 for the course ACCT 1237 taught by Professor Hillman during the Spring '10 term at Drake University .

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ACCT - Chapter 13 - Alex Fish ACCT042 Chapter 13...

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