A ________ standardizes items on the income statement and balance sheet as a percentage of total sales and total assets,respectively.
A) tax reconciliation statement
B) statement of standardization
C) statement of cash flows
D) common-base year statement
E) common-size statement

Question

Quizplus · Accepted Answer

A common-size statement standardizes items on the income statement and balance sheet as a percentage of total sales and total assets, respectively. This allows for easy comparison of financial statements across companies and time periods. The other options, such as tax reconciliation statement, statement of standardization, statement of cash flows, and common-base year statement do not perform this specific function.

A ________ Standardizes Items on the Income Statement and Balance