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Questions and Answers
What is the primary goal of financial statement analysis?
What is the primary goal of financial statement analysis?
- To interpret financial information (correct)
- To compare industry standards
- To forecast future economic conditions
- To prepare financial statements
Which of the following statements is true about financial statement analysis?
Which of the following statements is true about financial statement analysis?
- It does not involve analyzing past performance
- It is used only by investors
- It is essential for stakeholders like creditors and regulators (correct)
- It involves examining only the balance sheet
What tools or techniques are used in financial statement analysis?
What tools or techniques are used in financial statement analysis?
- Customer relationship management
- Trend analysis and ratio analysis (correct)
- Budgeting and forecasting
- Inventory management and procurement
Who uses financial statement analysis to evaluate potential returns and risks of investing in a company?
Who uses financial statement analysis to evaluate potential returns and risks of investing in a company?
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What is the purpose of using financial statement analysis for creditors?
What is the purpose of using financial statement analysis for creditors?
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