What is Common Size Statement

                                 COMMON SIZE STATEMENT

Meaning:-

            Common Size Statements are statements showing the different figures as a percentage to a base. It consists of common size balance sheet & common size income statement.

Format:-

PARTICULARS	YEAR	PERCENTAGE
Assets
Current Assets:-
Total Current Assets (a)
Fixed Assets:-
Total Fixed Assets (b)
Total Assets (a + b = c)
Liabilities
Current Liabilities:-
Total Current Liabilities (d)
Long Term Liabilities:-
Total Long Term Liabilities (e)
Total Liabilities (d + e = f)
Capitals & Reserves
Equity Share Capital
Preference Share Capital
Total Capitals & Reserves (g)
Total Liabilities & Capital (f + g = h)

Problems:-

1. From the following information prepare common size balance sheet.

Total Assets Rs.4,00,000 out of which Fixed Assets are Rs.2,50,000. Capital & Reserves are amounted to Ra.2,00,000. Long Term Liabilities amount to Rs.1,50,000.

Solution:-

PARTICULARS	YEAR	PERCENTAGE
Assets
Current Assets:-	1,50,000	37.5  %
Total Current Assets (a)	1,50,000	37.5 %
Fixed Assets:-	2,50,000	62     %
Total Fixed Assets (b)	2,50,000	62     %
Total Assets (a + b = c)	4,00,000	100      %
Liabilities
Current Liabilities:-	50,000	12.5   %
Total Current Liabilities (d)	50,000	12.5   %
Long Term Liabilities:-	1,50,000	37.5   %
Total Long Term Liabilities (e)	1,50,000	37.5   %
Total Liabilities (d + e = f)	2,00,000
Capital & Reserves:-
Total Capital & Reserves (g)
Total Liabilities & Capitals (f + g = h)

2. Following are the balance sheet of ‘X’ & ‘Y’ Ltd. As on 31.3.2008. Prepare common size balance sheet.

LIABILITIES	X	Y	ASSETS	X	Y
Equity Share Capital	2,00,000	3,00,000	Goodwill	1,00,000	50,000
Pref Share Capital	1,00,000	2,00,000	Plant &Machine	3,20,000	4,00,000
P/L A/C	50,000	40,000	Patents	50,000	80,000
9% Debentures	1,50,000	2,00,000	Furniture	40,000	75,000
Creditors	40,000	80,000	Stock	1,60,000	1,25,000
Income Tax Payab	80,000	50,000	Debtors	50,000	1,80,000
Long Term Loan	1,80,000	1,30,000	Cash	80,000	90,000
	8,00,000	10,00,000		8,00,000	10,00,000

Solution:-

PARTICULARS	X	PERCENTAGE	Y	PERCENTAGE
Current Assets:-
Stock	1,60,000	20       %	1,25,000	12.5   %
Debtors	50,000	6.25  %	1,80,000	18      %
Cash	80,000	10       %	90,000	9      %
Total Current Assets (a)	2,90,000	36.25 %	3,95,000	39.5  %
Fixed Assets:-
Goodwill	1,00,000	12.5    %	50,000	5      %
Plant & Machinery	3,20,000	40       %	4,00,000	40      %
Patents	50,000	6.25  %	80,000	8      %
Furniture	40,000	5       %	75,000	7.5   %
Total Fixed Assets (b)	5,10,000	63.75 %	6,05,000	60.5  %
Total Assets (a + b = c)	8,00,000	100      %	1,00,000	100     %
Liabilities
Current Liabilities:-
Creditors	40,000	5       %	80,000	8      %
Income Tax Payable	80,000	10       %	50,000	5      %
Total Current Liabilities (d)	1,20,000	15      %	1,30,000	13     %
Long Term Liabilities:-
9% Debentures	1,50,000	18.75  %	2,00,000	20      %
Long Term Loan	1,80,000	22.5    %	1,30,000	13      %
Total Long Term Liabilities (e)	3,30,000	41.25 %	3,30,000	33     %
Capital & Reserves
Equity Share Capital	2,00,000	25       %	3,00,000	30      %
Preference Share Capital	1,00,000	12.5    %	2,00,000	20      %
P/L A/C	50,000	6.25  %	40,000	4      %
Total Capital & Reserves (f)	3,50,000	43.75 %	5,40,000	54     %
Total Liab & Capital (d + e + f)	8,00,000	100      %	10,00,000	100     %