Question

The process of identifying the financial strengths and weaknesses of the firm by properly establishing relationships between the various items of Balance Sheet and the Statement of Profit and Loss is called ______.

विकल्प

• Comparative Statement Analysis

• Cash Flow Analysis

• Financial Analysis

• Common Size Analysis

Answer 1

The process of identifying the financial strengths and weaknesses of the firm by properly establishing relationships between the various items of the balance sheet and the statement of profit and loss is called financial analysis.

Explanation:

Financial Analysis is the overall process of evaluating a company’s performance and stability. It involves analysing data from the Balance Sheet and Statement of Profit and Loss to understand the firm’s financial health (strengths and weaknesses).