What does it do?
A common size balance sheet is one that has an additional column showing each monetary amount as a percentage of the total assets of the business. Since from the accounting equation, total assets also equals total liabilities plus equity, the common size balance sheet also shows the percentage each line item has to total liabilities plus equity.
The common size balance sheet calculator allows for two balance sheets to be entered so that comparisons can be made. The use of the common size balance sheet as a comparison tool is discussed more fully in our common size balance sheet tutorial.
This common size balance sheet calculator works out the percentage each line item of the balance sheet is to total assets. The calculation for each line item is given by:
Line item % = Line item value / Total assets value x 100%
For example, if a balance sheet has total assets of 25,278, and shows accounts receivable of 7,229, then accounts receivable is 7,229/25278 = 28.6% of total assets.
The Excel common size balance sheet calculator, available for download below, is used to produce the common size balance sheet by entering details relating to the balance sheet of the business. The calculator is used as follows:
Enter the titles of the two balance sheets, this might be for the same business for different accounting periods, or for different businesses requiring comparison.
Enter the balance sheet information for each business. This information might be from management information, published regulatory documents, or from industry standards for comparison.
The common size balance sheet calculator totals the balance sheet information and then works out the percentage each line item is in relation to the total assets of the business.
Common Size Balance Sheet Calculator Download
The common size balance sheet calculator spreadsheet is available for download in Excel format by following the link below.
The common size balance sheet calculator is one of many financial calculators used in bookkeeping and accounting, discover another at the links below.
Users use this common size balance sheet calculator at their own risk. We make no warranty or representation as to its accuracy and we are covered by the terms of our legal disclaimer, which you are deemed to have read. This is an example of an accounting tool that you might use when considering how to produce a common sized balance sheet. It is purely illustrative. This is not intended to reflect general standards or targets for any particular business, company or sector. If you do spot a mistake in this common size balance sheet excel calculator, please let us know and we will try to fix it.
About the Author
Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a degree from Loughborough University.