Which of the Following Is True of Ratio Analysis

question 21

Multiple Choice

Which of the following is true of ratio analysis?

• A) A ratio is computed by dividing one balance sheet or income statement 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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