491 11:34 10.6 (-)4G4 29KB/sFinancial Statement.studocu.com= StuDocuExercises - FS Analysis, Part 1 (Not graded)After reading and comprehending the 1st part of our discussion under Financial Statement Analysis,your are now ready to take some exercises. This self-assessment activity covers two parts:1. True or false; and2. Straight problem solvingHorizontal analysis of Comparative Statements (Increase-Decrease Method)Trend AnalysisVertical Analysis or Common Size Financial StatementsReminders:1. This is not a graded assessment.2. Write your answers including supporting computations in your JoL.3. A Google Drive link is provided for the answers and solutions.4. Use another color of ball pen when correcting your answers as an evidence that you actuallyanswered the items before looking at the solution.5. Perfect score here is irrelevant.6. The very purpose of this activity is to test yourself whether or not you have leaned somethingfrom the discussion.Part 1: True or false. Write the word "True" if the statement is correct, otherwise write "False".1. Financial analysis is primarily a matter of making relevant mechanical computations.2. Percentage changes usually are computed by use of the amounts for the latest accounting periodas a base3. The peso amount of change during an accounting period for an item appearing in financialstatements is less significant than the change measured as a percentage.A business enterprise's earnings performance and its financial condition are the two primaryconcerns of the financial analyst.5. An increase in sales volume generally is accompanied by a proportionate increase in net income6. On a, common-size income statement, net income is given an equivalent of 100%.7. The peso amount of a change during a period in a certain item appearing in financial statementsis probably less significant than the change measured as a percentage.8. Percentage changes are usually computed by using the latest figure as a base.9. It is possible that a decrease in gross profit rate may be offset by a decrease in expenses, thusresulting in an increase in net income.10. Industry standards tend to place the performance of a company in a more meaningfulperspective.11. Short-term creditors generally are more concerned with vertical analysis than with horizontalanalysis.12. Horizontal analysis is possible for both an income statement and a statement of financialposition.13. Common-size financial statements show peso change in specific items from one year to the next.1 out of 4Part 2Problem 1...

The answer is stated below: Note: Answering the first three subparts as there are multiple…

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Financial Statement.. studocu.com StuDocu

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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