Calculating the change in assets on a company’s balance sheet is an important step when analyzing a business or stock. The direction of these changes can be indicative of a company’s health and future prospects. Let’s work through an example to show how it’s done.
For this example, we’ll use this hypothetical balance sheet of ABC Company, an industrial manufacturer. The table below summarizes the company’s assets for the past two year-end periods.
Assets (in millions)