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Question
Consider the following statements.
Statement 1 - Ratio analysis helps in assessing the strengths and weaknesses in the performance of a business enterprise.
Statement 2 - "Ratio analysis is a tool for analyzing the financial statements of any enterprise."
Options
Only statement 1 is correct
Only statement 2 is correct
Both the statement is correct
None of these
MCQ
Solution
Both the statement is correct
Explanation:
Ratio analysis is a financial analysis tool that entails the ways of calculating and evaluating financial ratios in order to determine the strengths and weaknesses of a company's performance.
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Tools of Analysis of Financial Statements
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