Unbelievable Common Size Statement Formula

In the balance sheet the common base item to which other line items are expressed is total assets while in the income statement it is total revenues.

Common size statement formula. Line item Line item value Total revenue value x 100. The common figure for an income statement is total top-line sales. Formula This common size income statement calculator works out the percentage each line item of the income statement is of total revenue.

When you look at your sales statement you find that phone call sales bring in 100000 in-person sales bring in 50000 and online sales add up to 200000. Example of Common Size Income Statements Suppose Company ABC reports. The common size version of this income statement divides each line item by revenue or 100000.

The common-size percent is simply net income divided by net sales or 336 percent 11809 35119. Amount Base amount and multiply by 100 to get a percentage. Divide each item on the traditional income statement by the total sales revenue from the same statement.

Since we are doing a common size analysis we want the growth rate in sales stated as a percentage. For example 100000 in sales and 60000 in cost of goods sold indicates that COGS represents 60 percent of total sales revenue. The common-size statement formula equals the analysis amount divided by the base amount times 100.

Here is the common size analysis formula. The formula to calculate the growth rate is. Common Size Financial Statements.

Formula There is no such formula for deriving a common size income statement rather it is a method wherein a separate column is created and all the line items in the income statement are divided by the total sales and placed in the corresponding adjacent separate cell. Common size ratios are used to compare financial statements of different-size companies or of the same company over different periods. Finance Common-Size Statements.