Common-Size Financial Statements

question 56

Multiple Choice

Common-size financial statements

• A) allow for an easy comparison of balance sheets and income statements across firms in the industry.
• B) provide quantitative clues about the direction that the firm is moving.
• C) are obtained by dividing all income statement accounts by net sales and all balance sheet accounts by total assets.
• D) All of these choices are correct

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Definitions:

Variables

Elements, features, or factors that are liable to vary or change within a study or experiment.

Age

The length of time that a person or thing has existed; a particular stage in someone's life.

Amount of Hair

A characteristic referring to the density, thickness, and overall quantity of hair on an individual's body or head.

Negatively Correlated

A relationship between two variables in which one variable increases as the other decreases.