Indicate whether each of the following statements about financial statement analysis is true or false.The reason behind a financial statement ratio or percentage analysis result is usually self-evident and does not require further study or analysis.In horizontal percentage analysis, an item from the financial statements is expressed as a percentage of the same item from a previous year's financial statements.Horizontal analysis for several years can be done by choosing one year as a base year and calculating increases or decreases in relation to that year.One form of horizontal analysis is the preparation of common size financial statements.Vertical analysis compares two or more financial statement items within the same time period.
What will be an ideal response?
The reason behind a financial statement ratio or percentage analysis result is usually self-evident and does not require further study or analysis. F
In horizontal percentage analysis, an item from the financial statements is expressed as a percentage of the same item from a previous year's financial statements. T
Horizontal analysis for several years can be done by choosing one year as a base year and calculating increases or decreases in relation to that year. T
One form of horizontal analysis is the preparation of common size financial statements. F
Vertical analysis compares two or more financial statement items within the same time period. T
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Once a party to a contract repudiates the contract, it is rendered void with no way to withdraw the repudiation.
Answer the following statement true (T) or false (F)
The article titled “The Social Responsibility of Business Is to Increase Its Profits” that was published in the New York Times Magazine was written by ________________.
a. Edward Freeman b. E. Merrick Dodd, Jr. c. Milton Friedman d. Archie Carroll
A potential disadvantage of the high-low method is that:
a. it can not be used when there are many observations. b. it uses only two data points, which may not be representative of normal conditions. c. it is too time-consuming. d. it requires many observations in order to be used. e. None of the answers are correct.
Related corporate diversification does not necessarily provide opportunities
A. for cross-business collaboration to create valuable new competencies and capabilities. B. to exploit a first-mover strategy and capture valuable financial fits. C. to share other resources (besides brands) that support corresponding value chain activities across businesses. D. for transferring expertise, technology, and other capabilities from one business to another. E. for reducing costs on advertising by leveraging use of a competitively powerful brand name.