A) adding the item’s value to the gross income from all sources on the statement for the year; B) subtracting the item’s value from the gross income from all sources for the year; and C) multiplying the item’s value by the gross income from all sources for the year.
The dollar change for a comparative financial statement item is calculated by adding the items value to the gross income from all sources for the year on the statement for the year B subtracting the items value from the gross income from all sources for the year and C multiplying the items value by the gross income from all sources for the year.
If you have a lot of gross income from all sources and you have a lot of debt, then you will also have a lot of debt. The same thing is true for CFP. It’s hard to calculate a “value” when you have debt, which is why we call it a “comparative.” Debt is debt, but it’s hard to measure.
Debt is easy to measure. Just take the total amount of debt for a given year and divide by the gross income from all sources for a given year. A lot of debt = a lot of debt.
Debt is a pretty easy thing to calculate though, and CFP.com does this easily and quickly. All we have to do is plug in the numbers, and boom, the value of the item is calculated.
There’s a lot of math involved in calculating CFP.com’s value, and we do the math, so we don’t have to.
This is the kind of thing that gets people asking for help and getting the attention of experts. There is a lot of math involved in calculating what a credit reporting company’s value based on their credit report. This is a very detailed post about calculating all the items in a comparative financial statement. We have a post about Calculating Your Credit Score, but we can’t get into that post, unfortunately. But we can get into CFP.
The math we do is very detailed. Let me tell you the process: First you look at the credit report. Now you take the information about the company and its assets (the company) and the liabilities (the debt) and figure out how much of the company’s equity is in the company. Now you have to add up the company’s liabilities and the company’s equity.