A Firm Uses 2011 as the Base Year for Its

question 44

Multiple Choice

A firm uses 2011 as the base year for its financial statements.The common-size,base-year statement for 2012 has an inventory value of 1.08.This is interpreted to mean that the 2012 inventory is equal to 108 percent of which one of the following?

• A)2011 inventory
• B)2011 total assets
• C)2012 total assets
• D)2011 inventory expressed as a percent of 2011 total assets
• E)2012 inventory expressed as a percent of 2012 total assets

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Definitions:

Implementing Agreement

The act of putting into practice or executing the terms and conditions of a settled deal or consensus.

Responsibilities

Duties and tasks that an individual or entity is required to perform or oversee.

Scope

The extent or range of coverage, application, or operation; the breadth of something.

Interests

Refers to the preferences or desires individuals or groups have, which often guide their actions and decisions.