Explain the difference between the financial statement approach and the valuation approach. Which approach is superior for making short-term financial decisions? and why?

Q: Does the accounting (book) rate of return (ARR) method provide a valid (or, meaningful) measureof…

A:

Q: What is the purpose of financial statement analysis?

A: Financial statements are written records that convey the information on the financial performance,…

Q: How is the the financial ratio analyses very useful?

A: Ratio analysis is a method of relative measure between two numericals for gaining knowledge about a…

Q: How would you use financial statement analysis?         Is there one ratio that you feel is more…

A: Financial statements give ideas about performance of company within accounting period.We can compare…

Q: Consider the advantages and disadvantages of using the accounting rate of return as an investing…

A: This question explains about  the advantages and disadvantages of using the accounting rate of…

Q: What advantages does the forecasted financial statement method have over theAFN equation for…

A: Answer: AFN stands for “Additional funds needed” which is used to measure the amount of external…

Q: Why does financial planning usually equated with projections?

A: Financial planning is a stage process way of accomplishing individual's lifestyle goals. A financial…

Q: How does sustainability-aligned reporting differ from traditional financial reportin

A: The traditional financial Reporting represents the financial position of any organization while…

Q: why is there a need to use different financial tools and techniques?

A: Financial statement analysis- It is the process of reviewing and analyzing financial statements to…

Q: Examine some of the limitations of financial statements and suggest ways to overcome them.

A: Financial Statements are organised summaries of detailed information about financial position and…

Q: explain why an analyst attaches great importance to evaluation of the income statement

A: Meaning of Income statement- Income statement is one of the financial statements prepared by…

Q: What is “fair value”? Consider whether it is really helpfulwhen reporting financial results. Give…

A: Fixed assets: These include all the assets that are of tangible nature and have an expected useful…

Q: Discuss the ways in which the concept of present value as utilized in making financial decisions

A: The term present value refers to the formula or function that is used for determining the present…

Q: explore the limits of financial statements and how they might be improved

A: Here is Answer :

Q: What does it mean to adopt a maturity matching approach to financing assets, includingcurrent…

A: Maturity matching states that long period funds must be utilized to finance long period assets and…

Q: why net present value is considered to be superior to internal rate of return as an investment…

A: Investment- The purchase of an asset in order to generate income or capital gain is referred to as…

Q: What does it mean to adopt a maturity matching approach to financing assets, including current…

A: Matching concept while preparing the income statement , revenue  and profits are matched with…

Q: Which one of the following is most closely related to the net present value profile? A: Payback B:…

A: The net present value method is used to evaluate the investment projects. We can evaluate the…

Q: Discuss how the Accounting Rate of Return as an investment appraisal method is better than the Net…

A: Accounting ROR or ARR and Net Present Value(NPV) are tools that are used to make selection among…

Q: Analyze the disadvantages of financial performance measures and the advantages of non

A: Disadvantages of financial performance measures  1 They indicates short term performance measures. 2…

Q: What are some possible financial decisions in which using the Rate formula might be helpful

A: An interest rate, denoted r, is a rate of return that reflects the relationship between differently…

Q: Explain how the cost of capital may be used as a screening tool when applying the net present value…

A: Net present value: Net present value is a the increment return from an investment after covering the…

Q: Discuss the pros and cons of the accounting rate of return as an investment criterion.

A: Definition: Average rate of return method: The average rate of return is the amount of income that…

Q: Fair value is a more relevant measure to use in Financial Reporting than Historical Cost. Discuss

A: Introduction: Fair value accounting refers to the practice of valuing your company's liabilities and…

Q: what is the return asset that is used in financial statement analysis?

A: Here in this case we need to understand the meaning of return on asset ratio of financial statement…

Q: What are the fundamental elements of an adequate financial planning process. What are the…

A: Answer: Financial planning is nothing but an on-going mechanism for the advancement of the course…

Q: Explain the difference between deterministic and probabilistic financial planning models.

A:

Q: Are the use of non-GAAP financial measures ethical?

A: Generally Accepted Accounting Principles (GAAP): Generally Accepted Accounting Principles are the…

Q: In deciding the appropriate level of current assets for the firm, management is confronted with…

A: Current Assets: They are the assets that can be converted into cash easily and short term in nature.…

Q: Value drivers, explain how these drives are related to financial statement analysis and explain…

A: Definition:   Financial statements: Financial statements are condensed summary of transactions…

Q: how value drivers (Return on Equity, Net Profit Margin, and Total Asset Turnover) are related to…

A: Financial statements: Financial statements are the summary of transactions presented in the form of…

Q: “Explain the reasons why the net present value (NPV) method of investment appraisal is likely to be…

A: The Net Present Value (NPV) is a company's financial tool used to estimate the viability of…

Q: What are some of the problems is using AFN equation to estimate AFN rather than the pro-forma…

A: AFN (Additional funds needed)=Projected increase in assets-spontaneous increase in liabilities-any…

Q: What factors are frequently ignored in financial analysis? Why?

A: Qualitative factors are the factors that deal with an intangible as well as inexact information that…

Q: How can the financial statements provide the basis for future investment analysis?

A: Answer: Financial reports are structured accounts quantifying a firm’s financial power, efficiency,…

Q: Explain briefly what the terms working capital and working capital management imply. Explain the…

A: The Answer:

Q: The third step for making a capital investment decision is to establish baseline criteria for…

A: In order to establish baseline criteria for alternatives for making capital budgeting decisions, the…

Q: Give an example of a strength and a weakness of the accounting rate of return approach.

A: ARR stands for accounting rate of return, is a formula which computes the desired rate of return in…

Q: ___________ is the possible loss of revenue resulting mainly from a decline in the revenue base.…

A: There are various risks

Q: What are some qualitative factors that analysts should consider when evaluating acompany’s likely…

A: Qualitative factors are the factors which are non quantifiable for the examination of operations and…

Q: Two popular methods of financial statement analysis are time series analysis and periodic analysis.…

A: There are various methods which are adopted by the financial manager in order to analyze the…

Q: wrong about the use of financial statement analysis?

A: There are internal and external stakeholders of a company who are interested in determining the…

Q: Why must financial analysis be related to a specific objective?

A: Financial Analysis: The use of a business entity's financial statements in order to assess its…