Which of the following is not a reason why financial analysts use ratio analysis?
A. Ratios help to pinpoint a firm's strengths.
B. Ratios restate accounting data in relative terms.
C. Ratios are ideal for smoothing out the differences that may exist when comparing firms that use different accounting practices.
D. Some of a firm's weaknesses can be identified through the usage of ratios.
Answer:C
Which of the following is not a reason why financial analysts use ratio analysis?
A. Ratios help to pinpoint a firm's strengths. B. Ratios restate accounting data in relative terms. C. Ratios are ideal for smoothing out the differences that may exist when comparing firms that use different accounting practices. D. Some of a firm's weaknesses can be identified through the usage of ratios.