vertical analysis

Vertical analysis

Dividing each expense item in the income statement of a given year by net sales to identify expense items that rise more quickly or more slowly than a change in sales.

Vertical Analysis

On a balance sheet, a means of calculating assets, liabilities, and equities in which each intake or outlay is represented as a percentage of each group. For example, suppose a company has three liabilities: a debt to the bank, a bond issue, and salaries to employees. Vertical analysis would record each of these on a balance sheet as a percentage of the total amount the company carries in liabilities.

vertical analysis

The comparison of an item on a financial statement with a different item on the same statement. For example, an analyst may study a firm's balance sheet to compare the level of current assets with the level of current liabilities in order to measure liquidity. Analysts often study a firm's income statement to compare net income with total sales. Compare horizontal analysis.
References in periodicals archive ?
Comparing the values of vertical analysis with international studies on Caucasian population we found higher values of all the skeletal linear measurements.
One key way to get a handle on such irregularities in the first place is through horizontal and vertical analysis of financial statements that help spot trends, she said.
The report provides vertical analysis of the market, enabling readers to compare IT expenditures in the Polish telecoms, utilities, finance, trade and production, with an eye toward upcoming expansions and enhancements expected to take place in the next few years.
It is divided into two parts: first quadri-analysis of government budget in terms of reviewing the effectiveness of government programs and review efficiency, economy and fairness review and the second is the financial analysis of governmental budget in terms of horizontal, vertical analysis and ratio analysis.
Vertical analysis is the assessment of whether changes in the DV for one series following IV manipulation (e.
b) Vertical analysis is a technique for analyzing the relationships between the items on an income statement, balance sheet or statement of cash flow by expressing components as percentages.
Students download the 10-K of each company and then perform horizontal and vertical analysis on the financial statements.
Another crucial horizontal function is competition for scarce resources (at the heart of the notion of sustainability), but this is lacking in Miller's vertical analysis.
Title: European IP VPN Services Market - Vertical Analysis
The text defines five types of analytical procedures (horizontal analysis, vertical analysis, variance analysis, ratio analysis, and comparison with other operating information), but fails to provide detailed examples of how to use each of these techniques.
Using Steiner's large but underrecognized body of work as a starting point for re-examining antitrust policy the American Antitrust Institute's (AAI's) Roundtable, Combining Horizontal and Vertical Analysis in Antitrust: Implications of the Work of Robert L.
As shown in Table 1, vertical analysis of the FIRM's income statements shows the annual labor costs for accounting professionals within the FIRM increased from 54.