Which of the following statements describe the principal reasons why stockholders and credit analysts use financial statement analysis?
1) To assess the risks associated with payments on debt and return on investment
2) To predict the amount of expected returns
3) To establish recommended dividend and interest payments
4) To evaluate top and middle level management
A) 1 and 2
B) 1 and 4
C) 3 and 4
D) 1, 2, and 3

Question

Quizplus · Accepted Answer

1) Stockholders and credit analysts use financial statement analysis to assess risks related to debt payments and investment returns. 2) They also aim to predict future returns, making these the principal reasons for their analysis.

Which of the Following Statements Describe the Principal Reasons Why