Which of the Following Compare(s) Select Items in Financial Statements

question 20

Multiple Choice

Which of the following compare(s) select items in financial statements by computing percentages, rates, and proportions?

• A) profitability quotients
• B) ratio analysis
• C) vertical analysis
• D) pro rata analysis

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Definitions:

Cash

Liquid funds available for use in the form of currency or bank balances.

Treasury Stock

Company-released shares that have been bought back, consequently lowering the overall available shares for trading.

Par Common Stock

The face value of a share of common stock as specified in the corporate charter, with no bearing on the market value.

Fair Market Price

The price at which an asset would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts.