Financial Statements Quiz
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Questions and Answers

How can financial statements be read to understand changes over time?

  • By comparing them to prior periods (correct)
  • By comparing them to industry standards
  • By analyzing their absolute values
  • By comparing them to competitors

    • What do comparative income statements report?

  • Company's dividends for last year and this year
  • Company's total assets for last year and this year
  • Company's income for last year and this year (correct)
  • Company's expenses for last year and this year

    • How can financial statements be read to evaluate company performance against industry peers?

  • By analyzing their standalone values
  • By comparing them to competitors' financial statements (correct)
  • By comparing them to economic indicators
  • By comparing them to industry regulations

    • What do analysts gain by comparing financial statements to other companies?

    <p>Better sense of which companies are performing the best</p> Signup and view all the answers

    In what way are financial statements similar to reading a nutrition label or a baseball box score?

    <p>They can be understood through comparison</p> Signup and view all the answers

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