Q.From the following Balance Sheet figures for the year 2024, prepare a Common-Size Balance Sheet:
Equity share capital ₹6,00,000; Reserves and surplus ₹3,00,000; Long-term borrowings ₹2,00,000; Non-current (fixed) assets ₹7,50,000; Current assets ₹3,50,000.

A common-size balance sheet expresses every item as a percentage of the total of assets (equivalently, the total of equity and liabilities), taken as 100.

Step 1 — Find the common base.

Total of equity and liabilities = 6,00,000 + 3,00,000 + 2,00,000 = 11,00,000.

Total assets = 7,50,000 + 3,50,000 = 11,00,000.

The two totals agree (as they must), so the common base = ₹11,00,000 = 100%.

Step 2 — Express each item as a percentage of ₹11,00,000.

Sample computations: Equity share capital = 6,00,000 ÷ 11,00,000 × 100 = 54.55%; Reserves = 3,00,000 ÷ 11,00,000 × 100 = 27.27%; Long-term borrowings = 2,00,000 ÷ 11,00,000 × 100 = 18.18%; Non-current assets = 7,50,000 ÷ 11,00,000 × 100 = 68.18%; Current assets = 3,50,000 ÷ 11,00,000 × 100 = 31.82%. …

Cross-check: since owners' funds and outside debt together must equal 100% of the sources, 54.55% + 27.27% + 18.18% = 100% confirms the base was use …

The usual error is to use revenue/sales as the base for a common-size balance sheet — the base must be total assets (equal to total of equity and liabilities). Rounding each percentage independently can leave …