Which of the Following Statements About Financial Statement Analysis Is

question 98

Multiple Choice

Which of the following statements about financial statement analysis is incorrect?

• A)In horizontal percentage analysis,an item from the financial statements is expressed as a percentage of the same item from a previous year's financial statements.
• B)Vertical analysis compares two or more financial statement items within the same time period.
• C)Horizontal analysis for several years can be done by choosing one year as a base year and calculating increases or decreases in relation to that year.
• D)The reason behind a financial statement ratio or percentage analysis result is usually self-evident and does not require further study or analysis.

---

Definitions:

Behavioural Theory

A theory focusing on observable behaviors, emphasizing the learning experiences that mold human actions.

Cultural Differences

Variations in the beliefs, values, customs, and behaviors that distinguish one society or ethnic group from another.

Label Specific Emotions

The process of identifying and naming distinct feelings and emotions.

Autonomic Arousal

Refers to the activation of the autonomic nervous system, resulting in physical responses such as increased heart rate or sweating, often in reaction to stress or perceived threats.