Analysts Look for Red Flags in Financial Statements That May

question 114

Multiple Choice

Analysts look for red flags in financial statements that may signal financial trouble.Which of the following is a red flag that suggests that a company may be in trouble?

• A)a significant increase in net income for several years in a row
• B)a consistent movement in sales,merchandise inventory,and accounts receivable
• C)a reduction in the debt ratio
• D)operating activities as is a major source of cash flows

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Definitions:

Emerging Technologies

New and innovative technologies that have the potential to significantly impact existing markets and societal norms.

Globalisation

The method through which companies or various organizations gain international influence or begin functioning globally.

Resource Utilisation

The effective and efficient use of resources, such as time, money, and materials, to achieve defined objectives.

Goal Attainment

The process of setting, pursuing, and achieving objectives, often involving planning, effort, and persistence.