Question

A corporation reported cash of $27,550, total assets of $475,000, and current liabilities of $157,895 on its balance sheet. its common-size percent for cash equals:

Answer 1

The common-size percent for cash equals 5.8%.

What is the common-size percentage?

The common-size percentage is a financial statement analysis tool to evaluate and compare companies of different sizes, industries, and time quantitatively.

The technique uses percentages derived from absolute dollar figures.

For the balance sheet, the common-size percentage is based on the total assets.  The income statement's common-size percentages are based on the net revenue for the period.

Data and Calculations:

Cash = $27,550

Total assets = $475,000

Current liabilities = $157,895

Common-size percent for cash = 5.8% ($27,550/$475,000 x 100)

Thus, the common-size percent for cash equals 5.8%.

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