ratio and metric analysis

Analyzing up to 60 key ratios and metrics, such as liquidity, profits, sales, and more, our reports provide insight into the strengths and weaknesses of your company, so you can act with purpose, and invest your scarce resources where they will do the most good.

What is Common Size?

Common Size Ratios are used to compare financial statements from different periods by displaying line items as a percentage of a common base figure. 

The common size ratio for each line on the financial statement is calculated as follows:

        Common Size Ratio = (Item of Interest / Reference Item)

The ratios are expressed as percentages of the reference amount.  Common size statements are prepared for the Income Statement and Balance Sheet.

  •  Income Statement items are expressed as a percentage of Sales
  •  Balance Sheet items are expressed as a percentage of Total Assets

Expressing line items in proportion to some size-related measure allows for easy analysis between time periods of the same company so that business owners can avoid cost-cutting efforts where none are needed, or save advertising dollars for when they'll attract the most customers.