Which of the following items is generally used as a base in vertical analysis to express as its percentage the line items on the balance sheet?
A) Owner's equity
B) Depreciation expense
C) Total assets
D) Cost of goods sold

Question

Quizplus · Accepted Answer

Total assets are generally used as the base in vertical analysis to express as its percentage the line items on the balance sheet. This is because it represents the total investment of the company in all its assets, and comparing other line items as a percentage of total assets provides insight into the company's asset composition and overall financial health.

Which of the Following Items Is Generally Used as a Base