When Conducting Comparative Analysis by Reviewing Consecutive Balance Sheets

question 18

Multiple Choice

When conducting comparative analysis by reviewing consecutive balance sheets,

• A) all items on the balance sheet in Year t must be divided by their corresponding value in Year t-1 and subtract 1.
• B) all items on the balance sheet in Year t-1 must be subtracted from their corresponding value in Year t.
• C) all items on the balance sheet in Year t must be divided by net income in Year t-1.
• D) Both A and B are correct.

---

Definitions:

Bargaining Unit

A group of employees with a clear and identifiable community of interests who are represented by a single labor union in dealings with their employer.

Dues-paying Union Members

Workers who contribute financially to a union in exchange for membership and representation.

Wage Compression

The reduction in the difference in wages between employees within an organization, often as a result of policy or collective bargaining.

Union Contract

A collective agreement between an employer and a trade union representing the workforce, outlining wages, hours, and working conditions.