Question

4. The technique of converting figures into percentage in some common base is called

a) Ratio analysis b) Common size statement analysis

c) Trend percentage d) None of these​

Answer 1

hii mate ,

Option ( b ) is correct common size statement analysis

may be helpful ✌️

Answer 2

The correct answer is option (b) common size statement analysis.

• Common size analysis, also called direct analysis, is a tool that financial managers use to analyze financial statements.
• It assesses financial statements by presenting each item in the line as a percentage of the base value for that period.
• The methodology can be used to analyze three main financial statements, namely, balance sheet, income statement, and cash flow statement. In a balance sheet, the most common baseline for other line items is the total asset, while in the income statement, it is the total amount of revenue.