 QuickBooks Desktop 2023 Balance Sheet Vertical Analysis Let's do it within 2-its QuickBooks Desktop 2023. Support Accounting Instruction by clicking the link below giving you a free month membership to all of the content on our website broken out by category further broken out by course. Each course then organized in a logical reasonable fashion making it much more easy to find what you need than can be done on a YouTube page. We also include added resources such as Excel practice problems, PDF files and more like QuickBooks backup files when applicable. So once again click the link below for a free month membership to our website and all the content on it. Here we are in QuickBooks Desktop sample rock castle construction practice file provided by QuickBooks going through the setup process we do every time maximizing the homepage to the gray area view drop down noting that we have the hide icon bar and open windows list checked off open windows on the left hand side reports drop down company and financial looking at the P and L this time range change 010123124 customize the report up top with the fonts and numbers changing it on up to 12 okay yes okay and then we're going to go to the reports again company and financial this time the big balance sheet changing it this time with the fiscal year drop down fiscal year that's the one we want customize and it up top with the fonts and numbers changing it 12 okay yes and okay that's the setup process we do every time in prior presentations we've been looking at the customization tools up top noting that they're not just applicable to the balance sheet but generally to all reports we're continuing on with that now this time with a percentage kind of calculation of vertical analysis type of tool as we use it remember there could be differences in the outcome depending on the type of report for example balance sheet reports being as of a point in time the profit and loss or income statement reports having a time frame basically measuring performance over here whereas the balance sheet is showing us where we stand as of a point in time we'll talk more about the profit and loss will apply this tool to it in future presentations so we're going to go to the customize reports up top and we're just looking on the display tab we're looking at the percent of columns that's it we're just checking that one off and saying okay and we get this percentage column on the right hand side now sometimes you call this like a vertical analysis as opposed to what we did last time when we saw a percent column which was a horizontal type of analysis in other words if we're thinking about the change as we saw last time from one period to the last period one month to the next month the difference between the two and then we're looking at a percentage increase or decrease that's one kind of way we can look at a percentage analysis another way we can do it is to say let's compare this line item here for example the checking account to the total which in the case of the balance sheet is going to be the total assets so we're total assets down here so what I'm way down here I should say so I'm gonna I'm gonna minimize the liabilities in equity and just look at the asset side of things so we can think of this then kind of like you would think of a portfolio for example of your investments but in this case we're talking about a business a business that has six hundred and forty thousand seventy two thirty three in assets question being then where are those assets located from a dollar perspective we usually look at it at that way but we can also do it on a percentage basis and again that could be quite useful because we can compare it to other companies we might be benchmarking to other companies possibly companies that are larger to than us we can't really compare the fixed asset dollar amount for example but we might try to compare how much money we have invested in fixed assets versus other companies how much how much do we have a liquid in comparison on a percentage basis to our total as with other companies and certain industries you would expect to have similar kind of ratios because of course if we're in business we might be in a business where we're trying to invest most of our money into property plants and equipment for example because that's the thing that's going to be used to generate revenue into the future so let's see how this would work then on the calculations we could say okay let's look at the total cash we've got the sixty five sixty five three seven nine point two nine divided by the total assets down here divided by the total of six four oh seven two point three three that gives us about I'm gonna make this a little wider if I can wide enough there we go that gives us ten if I move the decimal two places over ten point two about so that would be the general idea that we can then compare the other companies how much do we have like in accounts receivable that basically we're waiting on hopefully a customer to be paying us with we've got the nine eight one oh five point one nine divided by the total divided by the total of six four oh seven two point three three about moving the decimal two places over fifteen point three percent so and these can give us some indications as to whether are we aligned up in a similar fashion as other companies that again we're trying to basically benchmark to we can do a similar kind of calculations down here on the liability and equity side noting that the bottom line for liability and equity will be the same because assets equal liabilities and equity so we could then be comparing say total liabilities even we could say here's our total liabilities and so if I take that percent which got we've got the four two oh four four two point seven three divided by my liabilities in equity divided by the six four oh seven two point three three that gives us our sixty five point seven percent and that's kind of the liabilities are what we owe to a third party so it's kind of a leverage type of calculation that we you know possibly loans and whatnot that we have in the liability as opposed to the equity representing the ownership percentage so remember if you think about the balance sheet assets minus liabilities assets equal liabilities plus equities you can also calculate it this way you could say assets are six four oh seven two point three three minus the liabilities so the liabilities which are owed to a third party which are four two oh four four two point seven three gives us the equity which is then attributable to the owners right that's kind of the book value worth of the company which you can then break out depending on the kind of ownership sole proprietorship one owner partnership multiple partner capital accounts or corporation which is broken out by the shares of ownership and then you can say okay I can take that two nineteen two to sixty nine divided by the total liabilities in equity which is the same as the total assets because these are two sides of the same coin you can think of it as this is what the company has this is who has claim to what the company has either third party liabilities the bank most likely and then equity us as the owners I always think of ourselves as the business owner so we're going to say that's going to be that divided by the six four oh oh two seven two point three three and we get the thirty four point three so you can see how this is getting into kind of a percentage or ratio analysis kind of tools that of course can be quite useful when kind of judging the health of a of a company and doing comparisons to the industry and comparisons to other companies and so on comparisons to our past and that kind of stuff so let's go up top and do our normal change here so if I was to customize this I'm going to remove this stuff here this date doesn't make any well this date still that state still good and we'll get we could change the name to maybe a balance sheet vertical analysis we can take off the pennies possibly will put some brackets around the negative numbers so let's do that customizing let's go to the headers and footers and I'm going to say this is going to be a balance sheet vertical analysis and if I mess up any spelling again you'll have to forgive me I'm going to say take off the date time report basis maybe we put our name in the footer down here as we've been doing fonts and numbers let's say we want the the parentheses negative numbers to be read and take the pennies off of it and then we say OK so there we have the balance sheet vertical analysis percentage column no pennies a little bit cleaner to look at red numbers on the negative numbers and if I was to check out the printing preview page like so you've got the name on the footer so where we there we go my name is on the foot long as it's not under the foot and that's OK so there we so there we go so that's the general idea with the vertical analysis