Which of the Following Is NOT True of Common-Size Balance

Multiple Choice

Which of the following is NOT true of common-size balance sheets?

A) Each asset and liability item on the balance sheet is standardized by dividing it by total assets.
B) Balance sheet accounts are represented as percentages of total assets.
C) Each asset and liability item on the balance sheet is standardized by dividing it by sales.
D) Common-size balance sheets allow us to make meaningful comparisons between the balance sheets of two firms that are different in size.