It is easier to evaluate a firm using its financial statements when the firm:
A)is a conglomerate.
B)is global in nature.
C)uses the same accounting procedures as other firms in its industry.
D)has a different fiscal year than other firms in its industry.
E)tends to have one-time events such as asset sales and property acquisitions.

Question

Quizplus · Accepted Answer

Comparability among financial statements is essential for meaningful analysis. When a firm uses the same accounting procedures as its peers within the industry, it becomes easier to compare and evaluate the financial performance of the firm.

It Is Easier to Evaluate a Firm Using Its Financial