4 is not a total for example cash inventory and other

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Unformatted text preview: % is not a total. For example, cash, inventory, and other assets can be restated as percentages of total assets; net income and each expense can be restated as a percentage of sales revenue. Financial statements that recast all items on the statement as a percentage of a selected item are called common-size financial statements. Financial Statement Analysis – Module 1 Financial Statement Analysis – Module 1 For example, each item on the income statement below is expressed as a percentage of sales. Sales Cost of goods sold Gross margin Total operating expenses Operating income Other income Income before taxes Income taxes Net income 2011 $38,303 19,688 $18,615 13,209 $ 5,406 2,187 $ 7,593 2,827 $ 4,766 Common-size financial statements allows for the comparison of different companies of different sizes. %...
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This note was uploaded on 01/19/2014 for the course ACCTMIS 2200 taught by Professor Smith during the Spring '12 term at Ohio State.

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