Question

Introduction of comparative statement and common size statement​

Answer 1

A Comparative statement is a financial statement that shows the financial position at different periods of time. The data is shown in a comparative form in order to give the financial position at 2 or more periods. A comparative statement shows absolute figures and its changes, absolute data in terms of percentage and its changes. Balance sheet and income statement are used to express comparative statements. It is used mainly to compare and understand the increase or decrease in sales, or in the cost of the goods that are sold, gross profit, net profit, etc.