Which of the Following Is NOT a Limitation Related to the Usage

question 17

Multiple Choice

Which of the following is NOT a limitation related to the usage of ratios when reviewing a firm's performance?

• A)Many firms experience seasonality in their operations.
• B)Ratios cannot be used to compare firms that are in the same industry if one firm's sales are higher than another firm.
• C)Some firms operate in a variety of business lines,which makes it difficult to make comparisons.
• D)Accounting practices differ widely among firms.

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Definitions:

Visual

Pertaining to sight or the ability to see, often used in the context of graphical or pictorial representation of information.

Flowcharts

Diagrams that represent a process or system using symbols and arrows to show the flow and sequence of steps.

Organization Charts

Diagrams that show the structure of an organization and the relationships and relative ranks of its parts and positions/jobs.

Difference

The state or measure of being unlike or dissimilar; a distinguishing characteristic between two or more things.