Which of the following pairs of terms related to financial statement analysis expresses each item in a financial statement as a percent of a base amount? O Vertical - Common Size O Horizontal - Common Size O Vertical - Trend O Horizontal - Trend
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- Vertical analysis: a. Is also known as common-size analysis b. Is a technique for evaluating financial statement data that expresses each item in a financial statement as a percentage of a base amount c. All of the above.is the statement which indicates the relationship of different items of financial statement with some common item by expressing each item as a percentage of such common item a. Comparative statement b. Ratio statement c. Common size statement d. Trend AnalysisWhat are common-size financial statements and how are they used? What item is the key figure (that is, 100 percent) in a common-size income statement? A common-size balance sheet
- Which of the following is true about a common size balance sheet? The assets, liabilities, and equities are reported at their market values. The assets, liabilities, and equities are reported as percentages of common stock. The assets, liabilities, and equities are reported as percentages of total assets. O The assets, liabilities, and equities are arranged in the alphabetical order. The assets, liabilities, and equities are reported as percentages of the assets, liabilities, and equities of a competing firm.In performing vertical analysis, we express each item in a financial statement as a percentage of a base amount. What base amount is commonly used for income statement accounts? For balance sheet accounts?How is the use of financial statement ratios?
- Which of the following are techniques, tools or methods of analysis and interpretation of financial statements? Select one: a. Comparative Analysis b. All of the above c. Trend Analysis d. Ratio AnalysisWhich of the following is a Profitability Ratio a. Proprietary Ratio b. Debt-Equity Ratio c. Earnings Per Share d. Fixed Asset Ratioc. Explain the following Investment ratios and indicate how they are computed:Earnings per share (EPS) and Price/Earnings ratio (P/E).
- What are the main ratios used to analyze financial statements?When using vertical analysis, we express balance sheet accounts as a percentage of a. Total assets. b. Total liabilities. c. Total stockholders’ equity. d. Sales.Which of the following is the major independent variable in constructing pro forma income statements and balance sheets? Select the correct response: total assets net income dividend payout sales