How Do You Create A Common Size Balance Sheet?
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A common size balance sheet is a balance sheet which reports both the numeric value and relerive percentage for total asset or total liability. This type of balance sheet is used by internal and external analysing purpose of a company and it is not used for a reporting requirement of generally accepted accounting principles(GAAP). This balance sheet shows the make up of a business with the various assets and liabilities through the presentation of percentages. And this affords quickly compare the historical trend of various line items of catagories and provide a report for comparison of two firms of different market captalization.
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