Question

One reason that a common-sized statement is a useful tool in financial analysis is that it enables the user to (A) determine which companies in a single industry are of the same value(B) judge the relative potential of two companies of similar size in different industries (C) make a better comparison of two companies of different sizes in the same industry (D) determine which companies in a single industry are of the same size

Answer 1

Answer:

A

Explanation:

One reason that a common-sized statement is a useful tool in financial analysis is that it enables the user to

Answer ) option a

that is  to make a better comparison of two companies of different sizes in the same industry

Just like Apple and Samsung both are different companies and have different size but are from same industry that is smart phones now a common-sized statement  can be used comparison of these two companies.

Answer 2

Answer:

The correct answer is letter "C": make a better comparison of two companies of different sizes in the same industry.

Explanation:

Common-sized statements portrait revenue sales as percentages in charts. As the scheme is simple, it is helpful to analyze the firm's performance over different periods and related-industry organization's performances. Investors can use common size income statements also to analyze how various components affect the company's profits and financial position.