Question

Bankruptcy prediction a. is used by creditors to minimize losses from loans, but it is not useful to equity investors. b. is not relevant for firms reporting losses because such firms are already performing poorly. c. is a combination of financial statement analysis and statistical modeling. d. is not relevant for firms reporting profits because there is no risk of bankruptcy.

Answer 1

Answer:

Option C

Explanation:

Bankruptcy prediction

is a combination of financial statement analysis and statistical modeling.

Therefore, the correct answer is c

Thus, when predicting the bankruptcy it becomes necessary to go through the financial statements of a company or the firm and also the statistical model so that it may be found out that whether the intended one would be bankrupt or not