Common-size financial statements present financial information in terms of percentages instead of dollar values. On a common-size statement, each line item is expressed as a percentage of a reference ...

A vertical analysis is used to show the relative sizes of the different accounts on a financial statement. For example, when a vertical analysis is done on an income statement, it will show the top ...

Company management often analyzes financial statement data to understand how the business is performing relative to where it was historically, and relative to where it wants to go in the future.