Question

    An analysis in which the firm’s ratio values are

    compared to those of a key competitor or group of competitors, primarily to identify areas for improvement is called?
    A Time-series analysis Correct Answer Incorrect Answer
    B Combined analysis Correct Answer Incorrect Answer
    C Benchmarking Correct Answer Incorrect Answer
    D Comparative analysis Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Benchmarking refers to the process of evaluating the firm’s accounting ratios and its financial performance with that of the competitor or a group of competitors in order to know where the entity needs to improve.

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