Interpreting ratios involves comparisons to: A.past years ratios. B.ratios from other entities in the same industry. C.ratios from entities in unrelated industries. D.comparisons can be made to all of the above.

------------------- is the type of ratio ratios give or bring out comparative facts

Fill in the Blank QuestionFill in the blank question. ratios measure how effectively a firm is using its various resources to achieve profits.

The ………….. ratios provide the information critical to the long run operation of the firm.a.Liquidityb.Profitabilityc.Solvencyd.Activity

Financial statement analysis is more meaningful if the ratios can be compared to an appropriate benchmark such as:Group of answer choiceslast year’s ratios.all of the other options are appropriate benchmarks.competitor ratios.industry averages.

The ratios used to facilitate the interpretation of an entity’s financial position and results of operations can be grouped into four (4) categories:Multiple choice question.liquidity, profitability, debt, and per shareactivity, productivity, debt, and cash flowliquidity, activity, common size, and profitabilityliquidity, activity, profitability, and debt