00:03
For this question, you're asking about vertical analysis.
00:06
Now, when we're doing vertical analysis, it's important to remember that most of the time, unless we're told otherwise, we need a base number, and that's going to come from revenue, which for us is right here.
00:21
Now, let's do 2021.
00:23
Our base revenue was 44 ,538, and this is millions, but we're just keeping it in the thousands because it's simpler.
00:31
And if you want to do vertical analysis, you would do different line items divided by the revenue to get income or profit, like net profit or profit percentage in terms of, if you did, like return on revenue would be for 44 ,000 sales, you did 19 ,962 in profit.
00:59
So that would tell you your return on your revenue.
01:03
Now, if you want to see how much you spent to get that revenue, you could do cost of sales divided by revenue, and that would be another percentage of for this amount of revenue, how much did it cost? what percentage of the revenue was cost or related to cost? in these different ratios, same thing you could do any of the other line items, operating expenses.
01:28
So return on operating expense, return on interest expense...