Choose One
Q. 1.
Ratio Analysis is
(a)
a fool-proof method of evaluating the financial performance of a firm.
(b)
only useful when read with other ratios, data such as company's track record, industry indices and competitors' ratios,(bench-marking and common-size statements) to form an overall assessment.
(c)
it is highly recommended to base financial analysis on ratios, which can be taken at face value.
(d)
useless without benchmarking.
Good! Your answer is right
The correct answer is (a)
Ratio Analysis is
only useful when read with other ratios, data such as company's track record, industry indices and competitors' ratios,(bench marking and common-size statements) to form an overall assessment.