Three types of comparisons commonly used in the financial statement analysis.

Question

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Answer 1

Question

Chapter 12, Problem 1RQ

To determine

To identify: Three types of comparisons commonly used in the financial statement analysis.

Expert Solution & Answer

Explanation of Solution

Financial information of a business are analyzed by the analysts, investors, creditors, auditors, and others parties to evaluate the financial status of the business by comparing its financial statements over the years, with the peer business, and with the industry as a whole. Thus, the three main ways to analyze the financial statements are as follows:

1. Horizontal Analysis: This refers to the year to year comparison of the performance of the business for different periods.
2. Vertical Analysis: This refers to the comparison of the performance of a business with its peer business.
3. Ratio Analysis: This refers to the of the performance measurement of the business, and know the trends in comparison to the other business in the same industry.

Conclusion

Hence, above three are the comparisons commonly used in the financial statement analysis.

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Answer 2

Question

Chapter 12, Problem 1RQ

To determine

To identify: Three types of comparisons commonly used in the financial statement analysis.

Expert Solution & Answer

Explanation of Solution

Financial information of a business are analyzed by the analysts, investors, creditors, auditors, and others parties to evaluate the financial status of the business by comparing its financial statements over the years, with the peer business, and with the industry as a whole. Thus, the three main ways to analyze the financial statements are as follows:

1. Horizontal Analysis: This refers to the year to year comparison of the performance of the business for different periods.
2. Vertical Analysis: This refers to the comparison of the performance of a business with its peer business.
3. Ratio Analysis: This refers to the of the performance measurement of the business, and know the trends in comparison to the other business in the same industry.

Conclusion

Hence, above three are the comparisons commonly used in the financial statement analysis.

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Answer 3

Question

Chapter 12, Problem 1RQ

To determine

To identify: Three types of comparisons commonly used in the financial statement analysis.

Expert Solution & Answer

Explanation of Solution

Financial information of a business are analyzed by the analysts, investors, creditors, auditors, and others parties to evaluate the financial status of the business by comparing its financial statements over the years, with the peer business, and with the industry as a whole. Thus, the three main ways to analyze the financial statements are as follows:

1. Horizontal Analysis: This refers to the year to year comparison of the performance of the business for different periods.
2. Vertical Analysis: This refers to the comparison of the performance of a business with its peer business.
3. Ratio Analysis: This refers to the of the performance measurement of the business, and know the trends in comparison to the other business in the same industry.

Conclusion

Hence, above three are the comparisons commonly used in the financial statement analysis.

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Answer 4

Question

Chapter 12, Problem 1RQ

To determine

To identify: Three types of comparisons commonly used in the financial statement analysis.

Expert Solution & Answer

Explanation of Solution

Financial information of a business are analyzed by the analysts, investors, creditors, auditors, and others parties to evaluate the financial status of the business by comparing its financial statements over the years, with the peer business, and with the industry as a whole. Thus, the three main ways to analyze the financial statements are as follows:

1. Horizontal Analysis: This refers to the year to year comparison of the performance of the business for different periods.
2. Vertical Analysis: This refers to the comparison of the performance of a business with its peer business.
3. Ratio Analysis: This refers to the of the performance measurement of the business, and know the trends in comparison to the other business in the same industry.

Conclusion

Hence, above three are the comparisons commonly used in the financial statement analysis.

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Answer 5

Chapter 12, Problem 1RQ

To determine

To identify: Three types of comparisons commonly used in the financial statement analysis.

Expert Solution & Answer

Explanation of Solution

Financial information of a business are analyzed by the analysts, investors, creditors, auditors, and others parties to evaluate the financial status of the business by comparing its financial statements over the years, with the peer business, and with the industry as a whole. Thus, the three main ways to analyze the financial statements are as follows:

1. Horizontal Analysis: This refers to the year to year comparison of the performance of the business for different periods.
2. Vertical Analysis: This refers to the comparison of the performance of a business with its peer business.
3. Ratio Analysis: This refers to the of the performance measurement of the business, and know the trends in comparison to the other business in the same industry.

Conclusion

Hence, above three are the comparisons commonly used in the financial statement analysis.

Answer 6

Chapter 12, Problem 1RQ

To determine

To identify: Three types of comparisons commonly used in the financial statement analysis.

Expert Solution & Answer

Explanation of Solution

Financial information of a business are analyzed by the analysts, investors, creditors, auditors, and others parties to evaluate the financial status of the business by comparing its financial statements over the years, with the peer business, and with the industry as a whole. Thus, the three main ways to analyze the financial statements are as follows:

1. Horizontal Analysis: This refers to the year to year comparison of the performance of the business for different periods.
2. Vertical Analysis: This refers to the comparison of the performance of a business with its peer business.
3. Ratio Analysis: This refers to the of the performance measurement of the business, and know the trends in comparison to the other business in the same industry.

Conclusion

Hence, above three are the comparisons commonly used in the financial statement analysis.

Answer 7

Chapter 12, Problem 1RQ

To determine

To identify: Three types of comparisons commonly used in the financial statement analysis.

Answer 8

Expert Solution & Answer

Explanation of Solution

Financial information of a business are analyzed by the analysts, investors, creditors, auditors, and others parties to evaluate the financial status of the business by comparing its financial statements over the years, with the peer business, and with the industry as a whole. Thus, the three main ways to analyze the financial statements are as follows:

1. Horizontal Analysis: This refers to the year to year comparison of the performance of the business for different periods.
2. Vertical Analysis: This refers to the comparison of the performance of a business with its peer business.
3. Ratio Analysis: This refers to the of the performance measurement of the business, and know the trends in comparison to the other business in the same industry.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Conclusion

Hence, above three are the comparisons commonly used in the financial statement analysis.

Answer 12

Ch. 12 - Prob. 1RQ Ch. 12 - Prob. 2RQ Ch. 12 - Prob. 3RQ Ch. 12 - Prob. 4RQ Ch. 12 - 5.In performing horizontal analysis, why is it...Ch. 12 - Prob. 6RQ Ch. 12 - Prob. 7RQ Ch. 12 - Prob. 8RQ Ch. 12 - Prob. 9RQ Ch. 12 - Prob. 10RQ

Three types of comparisons commonly used in the financial statement analysis.

To identify: Three types of comparisons commonly used in the financial statement analysis.

Explanation of Solution

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Chapter 12 Solutions