AN APPLICATION OF COMMON SIZE ANALYSIS IN THE FOOD INDUSTRY

Financial analysis is a method which has a strategic importance because of its ability to demonstrate the past financial and operating performance of companies. consequently, it is possible to make relevant decisions in terms of investments and financing. in order for financial analysis to provide this opportunity, financial statements should be prepared according to particular standards and relevant financial analysis techniques should be used. among these techniques, common size analysis provides the opportunity to examine the asset-liability structure and cost-revenue structure in terms of percentages and allows for comparison. the balance sheet and income statement of a sample company from the food industry have been evaluated by common size analysis and it has been observed that the company should concentrate on cost control and cash management for 2011-2012 period.