For meaningful analysis, ratios are best compared with
A) historical company averages.
B) industrial averages.
C) historical company averages and industrial averages.
D) no standard.

Question

Quizplus · Accepted Answer

Comparing ratios with both historical company averages and industrial averages provides a more comprehensive understanding of a company's financial performance. Historical company averages provide insights into the company's past performance, while industry averages offer benchmarks that enable comparison with other companies in the same sector. A comparison with these two standard provides a more complete picture and helps in making an informed decision.

For Meaningful Analysis, Ratios Are Best Compared with