Which one of the following statements is correct?
A) Book values should always be given precedence over market values.
B) Financial statements are rarely used as the basis for performance evaluations.
C) Historical information is useful when projecting a company's future performance.
D) Potential lenders place little value on financial statement information.
E) Reviewing financial information over time has very limited value.

Question

Quizplus · Accepted Answer

Historical information, such as past financial statements, can provide insight into a company's trends, patterns, and performance history, which can be useful when projecting future performance. Therefore, statement C is correct. Statements A, B, D, and E are all incorrect as book values do not always take precedence over market values, financial statements are commonly used for performance evaluations, potential lenders greatly value financial statement information, and reviewing financial information over time can provide valuable insights.

Which One of the Following Statements Is Correct