Which of the Following Is True of Ratio Analysis

question 32

Multiple Choice

Which of the following is true of ratio analysis?

• A) A ratio is computed by dividing one balance sheet item or income statement item by another.
• B) The choice of the scale determines the story that can be garnered from the ratio.
• C) Ratios can be calculated based on the type of firm being analyzed or the kind of analysis being performed.
• D) All of the above are true.

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Definitions:

Internal Nares

Openings inside the nose that connect the nasal cavity to the back of the throat.

Choanae

The internal nostrils located at the back of the nasal cavity in vertebrates, connecting the nasal passages to the throat.

Primary Bronchus

One of the two main branches of the trachea that lead directly into the lungs, conducting air in and out.

Secondary Bronchus

A branch of the primary bronchus that further divides into smaller airways in the lungs, known as tertiary bronchi.