Ratios Are Used as Tools in Financial Analysis

question 192

Multiple Choice

Ratios are used as tools in financial analysis

• A) instead of horizontal and vertical analyses.
• B) because they can provide information that may not be apparent from inspection of the individual components of the financial statements.
• C) because even single ratios by themselves are quite meaningful.
• D) because they are prescribed by GAAP.

---

Definitions:

Theory of Evolution

A scientific explanation for the diversity of life on Earth, proposing that species change over time through natural selection and genetic variation.

Acquired Traits

Characteristics or changes that are gained after birth due to environmental influences or personal actions, not determined by genes and therefore not inheritable.

Darwinian Evolution

The theory of biological evolution by natural selection proposed by Charles Darwin and Alfred Russel Wallace, emphasizing survival and reproduction of the fittest.

Genetic Variable

A factor in genetics that can be different in different organisms, affecting traits or outcomes in genetic research or inheritance.