In Analyzing Common-Sized Financial Statements

Multiple Choice

In analyzing common-sized financial statements,

A) unexpected changes or unusual relationships should be ignored.
B) comparisons between two or more companies are impossible because of the different sizes of the base numbers.
C) financial ratios will be equal to industry norms.
D) year-to-year comparisons cannot be made.
E) relationships between financial statement items and a constant base are calculated.