With Regard to Trend Analysis Over Time,which of the Following

question 46

Multiple Choice

With regard to trend analysis over time,which of the following statements is TRUE?

• A)We often look at the past five years of financial statements to establish trends and then predict future performance based on these trends.
• B)To look at trends over time requires that we examine a financial statement at one point in time.
• C)The net income last year was $20,000 and the past five years has shown an increase of 10% on average for each of these five years.The predicted net income for next year is still $20,000.
• D)It is better to predict future performance by basing it solely on net income than on all the individual accounts.

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Definitions:

Cochlea

A spiral-shaped, fluid-filled inner ear structure; it is essential for hearing as it transforms sound into nerve impulses.

Sensory Receptors

Specialized cells or nerves that detect changes in the environment and send signals to the brain.

Eardrum

The thin, membrane-like structure that separates the outer ear from the middle ear and vibrates in response to sound waves.

Audition

The formal term for the sense of hearing.