In this video, discover the need for common-sizing financial statements. This is an income statement in which each account is expressed as a percentage of the value of sales.
- In fiscal 2018, Walmart's net income was $7.17 billion. … In that same fiscal 2018 … Target's net income was $2.937 billion. … So is Walmart better than Target? … At the end of fiscal 2018 … Walmart had inventory of $44.269 billion, … and Target had inventory of $9.497 billion. … Which company is more efficiently managing its inventory? … Well, without some consideration … of the differing size of these two companies, … we really can't intelligently answer these questions. … Common-size financial statements … are an easy and useful tool for transforming … financial statement data to adjust for size differences. … Simply stated, a common-size financial statement … is a financial statement in which all the numbers … have been divided by sales for the year. … The result is a financial statement … composed of percentages. … Each number is stated as a percentage of sales for the year. … Now here's a common-size income statement for Walmart … and for Target for fiscal 2018. … Let's start at the bottom. …
- Accounting basics
- Reviewing the balance sheet and income statement
- Credits, debits, and journal entries
- Making financial statements
- Issues in financial accounting
- Revenue recognition
- Deferring taxes
- Analyzing financial statements
Skill Level Beginner
Accounting Foundations: Internal Controlswith Kay Stice1h 46m Intermediate
Cost Accounting: Analyzing Product Profitabilitywith Rudolph Rosenberg56m 49s Intermediate
Why financial accounting?1m 13s
1. Accounting Basics
The accounting equation3m 37s
2. The Financial Statement
3. The Mechanics of Accounting
4. Current Issues in Financial Accounting
5. Financial Statement Analysis
- Mark as unwatched
- Mark all as unwatched
Are you sure you want to mark all the videos in this course as unwatched?
This will not affect your course history, your reports, or your certificates of completion for this course.Cancel
Take notes with your new membership!
Type in the entry box, then click Enter to save your note.
1:30Press on any video thumbnail to jump immediately to the timecode shown.
Notes are saved with you account but can also be exported as plain text, MS Word, PDF, Google Doc, or Evernote.