Why Would You or Why Wouldn't You Compare an Organization

question 26

Essay

Why would you or why wouldn't you compare an organization like Ford Motor Company to the local car dealer "Johnson City Ford/Lincoln/Mercury" in vertical and horizontal analysis?

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Definitions:

Cost Allocation

The process of identifying, aggregating, and assigning costs to cost objects, such as products, services, or departments.

Intangible Asset

An identifiable non-monetary asset without physical substance, such as patents, trademarks, and goodwill, that provides economic benefits.

Amortization

The process of spreading the cost of an intangible asset over its useful life.

Legal Life

The duration for which an entity, asset, or agreement is legally effective or recognized.