Which of the Following Types of Financial Statement Analysis Would

question 97

Multiple Choice

Which of the following types of financial statement analysis would be used to see how a company's operating expenses as a percentage of net sales have changed from one year to the next?

• A)vertical analysis
• B)horizontal analysis
• C)ratio analysis
• D)analysis of internal control system

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Definitions:

Closing The Books

The process of finalizing all accounts and preparing financial statements at the end of an accounting period.

Transactions

Acts of buying, selling, or exchanging goods, services, or financial assets in the market.

Double Entry

An accounting principle that requires every financial transaction to be recorded in two accounts, debit and credit, to keep financial statements balanced.

Balance Sheet

A balance sheet that presents a firm's financial position, detailing its assets, liabilities, and owners' equity at a particular moment.