Question

In Common-size Statement of Profit & Loss;

Options

• Figure of Net Revenue from Operations is assumed to be 100.

• Figure of Gross Revenue from Operations is assumed to be 100.

• Figure of Net Profit is assumed to be 100.

• Figure of Net Assets is assumed to be 100.

Answer 1

Figure of Net Revenue from Operations is assumed to be 100.

Explanation:

In a Common-size Statement of Profit & Loss, Net Revenue from Operations (Net Sales) is taken as the base value and assumed to be 100%. Every individual expense and profit line item is then calculated and expressed as a percentage of this net revenue, which helps businesses easily track, analyse, and compare their operational expenses and profit margins over time