| Business segment | Part of a company that can be separately identified by the products or services that it provides or by the geographic markets that it serves; also called segment.
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| Common-size financial statement | Statement that expresses each amount as a percent of a base amount. In the balance sheet, total assets is usually the base and is expressed as 100%. In the income statement, net sales is usually the base.
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| Comparative financial statement | Statement with data for two or more successive periods placed in side-by-side columns, often with changes shown in dollar amounts and percents.
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| Efficiency | Company's productivity in using its assets; usually measured relative to how much revenue a certain level of assets generates.
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| Equity ratio | Portion of total assets provided by equity, computed as total equity divided by total assets.
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| Extraordinary gains or losses | Gains or losses reported separately from continuing operations because they are both unusual and infrequent.
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| Financial reporting | Process of communicating information relevant to investors, creditors, and others in making investment, credit, and business decisions.
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| Financial statement analysis | Application of analytical tools to general-purpose financial statements and related data for making business decisions.
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| General-purpose financial
statements | Statements published periodically for
use by a variety of interested parties; includes the income statement, balance sheet, statement of owner's equity (or statement of retained earnings for a corporation), statement of cash flows, and notes to these statements.
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| Horizontal analysis | Comparison of a company's financial condition and performance across time.
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| Infrequent gain or loss | Gain or loss not expected to recur given the operating environment of the business.
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| Liquidity | Availability of resources to meet short-term cash requirements.
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| Market prospects | Expectations (both good and bad) about a company's future performance as assessed by users and other interested parties.
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| Profitability | Company's ability to generate an adequate return on invested capital.
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| Ratio analysis | Determination of key relations between financial statement items as reflected in numerical measures.
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| Solvency | Company's long-run financial viability and its ability to cover long-term obligations.
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| Unusual gain or loss | Gain or loss that is abnormal or unrelated to the company's ordinary activities and environment.
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| Vertical analysis | Evaluation of each financial statement item or group of items in terms of a specific base amount.
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| Working capital | Current assets minus current liabilities at a point in time.
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