Which Analysis Deals with Comparing Items in a Financial Report

question 75

Multiple Choice

Which analysis deals with comparing items in a financial report by expressing each item as a percentage of a certain base total?

• A) Vertical analysis
• B) Ratio analysis
• C) Trend analysis
• D) Common-size statement

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Definitions:

GAAP Requirements

The set of standardized guidelines and principles designed for financial accounting, used to ensure consistency, clarity, and comparability of financial statements.

Impairment Losses

Losses recognized when the carrying amount of an asset exceeds its recoverable amount.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) for the preparation of public company financial statements on a global basis.

GAAP

A series of standard accounting protocols and measures adopted broadly for financial statement compilation.