Question

Apple Inc. reported revenues of 234 billion USD and net income of 53 billion USD in 2015. These figures represent a stunning annual growth in revenue and net income of 28 percent and 33 percent, respectively, for 2014. This information indicates the importance of using ________ to evaluate company financial performance.

Answer 1

Answer:

historical comparison

Explanation:

When you are performing a historical comparison of financial statements, you are comparing the current financial statement against older financial statements of the same company to understand how certain accounts have changed over time and affected the company's financial health and profitability.

In this case, Apple's 2015 financial statements were compared against their past 2014 statements and the growth rates were calculated: revenues grew by 28% and net income grew by 33%. If compared against any industry parameter, this growth rate was exceptional and stunning, but it also is not sustainable in time (if Apple kept growing this way in less than 20 years it would have been larger than the US economy).

When comparing historical information you must also consider future probabilities of the data repeating.

Answer 2

Answer: Historical comparison

Explanation:

Historical comparisons in organizations is when two or more events or cases are compared in order to discover a trend and evaluate the performance of an organization.

Apple Inc. had revenues of 234 billion USD coupled with a net income of $53 billion in 2015 and the figures represent an annual growth in revenue and the net income for 2014 indicated that an historical comparison has been done.