Question

what is the difference between comparitive and cmmon size statements

Answer 1

Financial statements are of wide use to a number of stakeholders, especially for shareholders as such statements provide a number of important information. Comparative and common size financial statements are two forms of statements used by companies to extract financial information. The key difference between comparative and common size financial statements is that comparative financial statements present financial information for several years side by side in the form of absolute values, percentages or both whereas common size financial statements present all items in percentage terms – balance sheet items are presented as percentages of assets and income statement items are presented as percentages of sales.