Question

Main objective of common size balance sheet is ______.

Options

• To establish relationship between revenue from operations and other items of statement of profit & loss

• To present changes in assets and liabilities

• To present changes in various items of income and expenses

• All of the Above

Answer 1

Main objective of common size balance sheet is to present changes in assets and liabilities.

Explanation:

A Common size balance sheet shows all assets, liabilities, and equity items as percentages of total assets or liabilities. This helps in analysing the structure of the balance sheet and understanding how each item contributes to the entire.