Looking back at previous income statements shows similar trends for each company. Which company do you choose to invest in and why?
A) SweetFeet, because analyzing both the balance sheet and income statement show that it has a healthier financial position than SportsAde.
B) SportsAde, because the balance sheet shows that its assets are higher than SweetFeet's assets.
C) SweetFeet, because the income statement shows that it has a higher profit than SportsAde.
D) SportsAde, because analyzing both the balance sheet and income statement show that it has a healthier financial position than SweetFeet.

Question

Quizplus · Accepted Answer

Looking at both balance sheets and income statements provides a more comprehensive view of the financial position of each company. In this case, SweetFeet has a healthier financial position based on analysis of both statements. The fact that SweetFeet has a higher profit on the income statement is also a positive indicator for potential investors.

Looking Back at Previous Income Statements Shows Similar Trends for Each