1 managers use ratios to monitor operations and help make business decisions 2 the p 4305789

1 managers use ratios to monitor operations and help make business decisions 2 the p 4305789

1) Managers use ratios to monitor operations and help make business decisions.

2) The primary reason for conducting financial analysis is to uncover fraud.

3) It is generally considered more useful to know the percentage change in financial statement amounts from year to year than to know the absolute dollar amount of their change.

4) When preparing a horizontal analysis of financial statements, subtract the later year amount from the earlier year amount and divide by the earlier year amount.

5) Horizontal analysis is the study of  percentage changes in financial statement balances from one year to the next.

6) Creditors are more concerned about short-term liquidity and long-term solvency.

7) Investors are more concerned about short-term liquidity and long-term solvency.

8) Investors are more concerned about profitability, dividends, and future share prices.

9) Creditors are more concerned about profitability, dividends, and future share prices.

10) Trend percentages are a form of horizontal analysis.

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