A company's net income as a percentage of sales is 15%.Using vertical analysis,the cost of goods sold as a percentage of sales must be 85%.

Question

Quizplus · Accepted Answer

Vertical analysis does not directly determine the cost of goods sold as a percentage of sales based on net income percentage. It involves comparing each line item on a financial statement to a base figure from that statement, not inferring specific expense percentages from net income percentage.

A Company's Net Income as a Percentage of Sales Is