Which one of the following statements is correct?
A) Book values should always be given precedence over market values.
B) Financial statements are frequently the basis used for performance evaluations.
C) Historical information has no value when predicting the future.
D) Potential lenders place little value on ﬁnancial statement information.
E) Reviewing ﬁnancial information over time has very limited value.

Question

Quizplus · Accepted Answer

Financial statements are often used as a basis for performance evaluations, as they provide information about the financial health and performance of a company. Book values and market values are both important in different ways, and historical information can be useful in predicting future trends. Potential lenders do place value on financial statement information, as it helps them assess the creditworthiness and financial stability of a company. Reviewing financial information over time can provide valuable insights into a company's performance, trends, and areas of strength or weakness. However, it is important to exercise caution when making projections or assumptions based solely on historical information.

Which One of the Following Statements Is Correct