How horizontal analysis of financial statements can help you in investing

Horizontal analysis of financial statements is a technique used to evaluate trends and growth pattern of financial performance over time by comparing historical data such as line items and financial ratios over a number of accounting period. It’s also referred to as trend analysis or time series analysis of financial statements. You can use horizontal … Read More » "How horizontal analysis of financial statements can help you in investing"

What is special journal in financial accounting system

Special journal or register is used to segregate duties for better internal control in accounting department and to keep special journal entries separate from general ledger. Segregation of duties in accounting department is based on the function they perform or the responsibility they undertake. Here are the list of some of the special journal maintained … Read More » "What is special journal in financial accounting system"

Understanding intangible assets on the balance sheet

Intangible assets are those identifiable assets which has no physical substance and is not a financial instrument. This means you can not touch it. Intangible assets are disclosed under the head non-current assets on the company’s balance sheet as these are long-term resources of the organization. It’s the opposite to tangible or physical assets such … Read More » "Understanding intangible assets on the balance sheet"

What is common-size vertical analysis of financial statements

Vertical analysis is a technique used to express line items of financial statements in relation to a single item or base. For vertical analysis of income statement, revenue is considered as a base and for balance sheet, total assets is considered as a base. It’s also referred as vertical common-size analysis of financial statements or … Read More » "What is common-size vertical analysis of financial statements"