A Limitation in Calculating Ratios in Financial Statement Analysis Is

question 46

Multiple Choice

A limitation in calculating ratios in financial statement analysis is that

• A) it requires comparisons.
• B) no one other than management would be interested in them.
• C) some financial statements contain many estimates.
• D) they seldom identify problem areas in a company.

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Definitions:

Magnuson-Moss Act

A federal law in the United States that governs warranties on consumer products, aiming to protect consumers against deceptive warranty practices.

UCC

Uniform Commercial Code; a comprehensive set of laws governing all commercial transactions in the United States.

Federal Contract Laws

Regulations that govern the procurement process, awarding, and execution of contracts by the federal government.

Warranty Waiver

A legal document or clause where a party agrees to relinquish their rights to a warranty provided in a contract.