1. Financial statement analysis:
A. Is application of analytical tools to general-purpose financial statements and associated data for making business decisions.
B. Involves transforming accounting data into helpful information for decision-making.
C. Helps users to take better decisions.
D. Helps to reduce uncertainty in decision-making.
E. All of these.
2. The building blocks of financial statement analysis include:
A. Liquidity and efficiency.
B. Profitability.
C. Solvency.
D. Market prospects.
E. All of these.
3. Standards for comparisons in financial statement analysis add:
A. Intracompany standards.
B. Industry standards.
C. Competitors' standards.
D. Guidelines (rules of thumb).
E. All of these.
4. Horizontal analysis:
A. Is a method used to determine changes in financial data across time.
B. Is also called vertical analysis.
C. Is a tool used to evaluate financial statement items relative to industry statistics.
D. Is the presentation of financial ratios.
E. Determine financial data across industries..