Financial Statement Analysis 1

TRUE or FALSE. Financial Statement Analysis involves careful selection of data from financial statement for the primary purpose of forecasting the financial wealth of the company.

TRUE or FALSE. Another important aspect of financial analysis is comparison of actual financial conditions with expected financial conditions.

TRUE or FALSE. Expected conditions may be presented by a predetermined standards, past performance of the company and competitors’ performance of industry average.

TRUE or FALSE. Short-term Creditors are those who provide funds, goods and services to a business expecting payment within one year or whatever time period is customary in the industry.

TRUE or FALSE. Long-term Creditors include banks and other institutions who lend money to companies for a shorter period of time.

TRUE or FALSE. Intracomparability means a company’s financial statements from the current period are being compared with the financial statement of prior or earlier periods.

TRUE or FALSE. Intercomparability - deals with the comparative analysis of the company’s financial statement against an indirect competitor.