Vertical Analysis Calculator

Vertical analysis allows the comparison of financial statements by representing each line item on the statement as a percentage of another (base) line item.

The vertical analysis calculator allows for details of an income statement and a balance sheet to be entered, and calculates each line item as a percentage of the relevant base line item. The use of vertical analysis as a comparison tool is discussed more fully in our vertical analysis tutorial.

Formula for Vertical Analysis Calculator

For the income statement the vertical analysis calculator works out the percentage each line item is of total revenue. The vertical analysis formula used for each income statement line item is given by:

Line item % = Line item value / Revenue

For example, if the income statement has total revenue of 40,000, and shows operating expenses of 16,000, then operating expenses are 16,000/40,000 = 40.0% of total revenue

For the balance sheet, the vertical analysis calculator works out the percentage each line item is of total assets. The vertical analysis formula used for each balance sheet line item is given by:

Line item % = Line item value / Total assets

For example, if the balance sheet has total assets of 31,000, and shows inventory of 4,000, then inventory is 4,000/31,000 = 12.9% of total assets.

vertical analysis calculator v 1.0
Vertical Analysis Calculator Preview

Instructions

The Excel vertical analysis calculator, available for download below, is used to produce the vertical analysis by entering details from the income statement and balance sheet of the business. The calculator is used as follows:

Step 1

Enter the relevant accounting period, for example, Year 1, 2016, Month 1 etc.

Step 2

Enter the income statement information for the business. The information will be for the relevant accounting period, such as the year ending 2015, and will come from management information, published financial statements, or from industry standards used for comparisons.

The vertical analysis calculator calculates the percentage each income statement line item has to the revenue line.

Step 3

Enter the balance sheet information for the business. The balance sheet information will be as at the end of the accounting period, and again will come from management information, published financial statements, or from industry standards.

The vertical analysis calculator calculates the percentage each balance sheet line item has to the total assets line.

Vertical Analysis Calculator Download

The vertical analysis calculator spreadsheet is available for download in Excel format by following the link below.

The vertical analysis calculator is one of many financial calculators used in bookkeeping and accounting, discover another at the links below.

Notes and major health warnings
Users use this vertical analysis calculator at their own risk. We make no warranty or representation as to its accuracy and we are covered by the terms of our legal disclaimer, which you are deemed to have read. This is an example of an accounting tool that you might use when considering how to calculate vertical analysis. It is purely illustrative. This is not intended to reflect general standards or targets for any particular business, company or sector. If you do spot a mistake in this vertical analysis excel calculator, please let us know and we will try to fix it.
Vertical Analysis Calculator November 6th, 2016Team

You May Also Like


Related pages


sum of the digits formulatrial balance questions and answersday sales outstanding calculationvertical analysis cash flow statementusage variance formulasubsidiary journalsbond discount amortization calculatoraccruals accounting entriesyear end adjusting journal entriesaccrual journal entry examplenon compound interest calculatorpresent value of a growing annuity formulaaccounts receivable examples general ledgerfv function exceltrial balance example ukannuities due formulamargin calculator excel templateexample of perpetuityaccount payable and account receivable interview questionsstatement of retained earnings examplesaccounting for royalty incomecalculate depreciation straight linepresent value perpetuity formulaformula for owners equityinventory lcmfixed asset turnover interpretationsample cash receipt voucherformula for annuitiesdouble booking accountingaccounting principle of conservatismjournal entries that bring accounts up to datewhat is roa ratiodupont analysis chartvariable cost revenue ratioshare buyback accounting entrieseffeciency ratiosformula for calculating markup percentagewhat is prepaid insurance on a balance sheetgaap basicsformula for annuity future valuefifo method accountingaccruals and prepayments definitionperpetuity formulaprovisioning in accountingwhat is a contra assetstock dividend journal entry exampleexample accounting equationoverhead absorption costingwhat does the contribution margin tell youexamples of direct laborpayroll clearing accountpresent value annuity calculationnet realisable value definitionvoucher samplesdouble entry for accrualcalculating deferred tax assettimes interest earned tie ratiopercent complete formulaformula rocepayment received in advance journal entryreceivable turnover ratio formulastandard costing and variancessmall business spreadsheet templatecash voucher template excelmaterial requisition formfifo accounting calculatorcheque payment receipt format in wordsingle entry ledger booksundry debtors in balance sheetdiscounting notes receivabledouble decline depreciationassets employed formulagrowing annuity future valuedebtor ledgerformula of asset turnover ratiohow to record accrued expensesdisadvantages of payback periodaccounting templates for small businessa compound journal entry involvesbalance sheet excel samplegross profit markup calculatora chart of accounts for a merchandising business