If Vertical Analysis,using Total Assets as the Base,shows a Decrease

question 149

Multiple Choice

If vertical analysis,using total assets as the base,shows a decrease in current assets from 50% to 36%,this would always mean that:

• A) total noncurrent assets have increased as a percentage of total assets
• B) the dollar amount of noncurrent assets has increased
• C) the current ratio has decreased
• D) the dollar amount of total current assets has decreased

---

Definitions:

Accounting Costs

Costs recognized in the financial statements, consisting of both explicit costs like wages and materials, and allocated costs such as depreciation.

Allocated

Refers to the distribution or assignment of resources, costs, or expenses to various departments, projects, or activities.

Over Budget

A situation in which actual spending exceeds the planned or allocated budget.

Investment Turnover

A ratio that measures the efficiency of a company in generating sales or revenue from its investment in assets.