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 analysis to … [Read more...] about How horizontal analysis of financial statements can help you in investing
Archives for June 2019
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 in the accounting … [Read more...] about What is special journal in financial accounting system
Understanding intangible assets on the balance sheet
Intangible assets are those identifiable assets which have no physical substance and are 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. The opposite of intangible asset is tangible or physical assets such as … [Read more...] about 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 common-size vertical analysis of … [Read more...] about What is common-size vertical analysis of financial statements