Consulting-style analysis of hypothetical 'USA Inc.' financial metrics

Then, Aim to Determine What ‘Normal’ Is... e We review 40-year income statement patterns and focus on ‘average’ / ‘normal’ levels of USA Inc.’s revenue drivers (primarily related to taxes) and expense drivers (by category) as a percent of revenue, as a starting point to help define ‘average’ / ‘normal.’ e Established businesses typically determine their expense levels based on their revenue trend / outlook. e In a perfect world, the government (and its citizens) would continually review the multiple variables in the income statement of USA Inc. (in a bipartisan way) and would work hard to foster compromise, in order to optimize revenue and expenses for the long term AND the short term. KP www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 223 Considering USA Inc. ‘Normal’ / Average Financial Metrics / Ratios For... 1) Revenue Growth 2) Revenue Drivers as Percent of Revenue 3) Expense Growth by Category 4) Category Expenses as Percent of Expenses KP www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 224 HOUSE_OVERSIGHT_020953