When you compare the current quick ratio for a ﬁrm to the ﬁrm's quick ratio from prior periods, you are conducting _____ analysis.
A) peer group
B) industrial classiﬁcation
C) proﬁtability
D) external-trend
E) time-trend

Question

Quizplus · Accepted Answer

When comparing the current quick ratio to the quick ratio from prior periods, you are conducting time-trend analysis. This involves analyzing a company's financial performance over time to identify trends in financial ratios and indicators. The other answer choices (peer group, industrial classification, profitability, and external-trend) do not accurately describe this type of analysis.

When You Compare the Current Quick Ratio for a ﬁRm