English

Comparison of actual values of one firm with those of another firm belonging to the same industry is ______.

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Question

Comparison of actual values of one firm with those of another firm belonging to the same industry is ______.

Options

  • Intra-firm comparison.

  • Inter-firm comparison.

  • Pattern comparison.

  • Standard comparison.

MCQ
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Solution

Comparison of actual values of one firm with those of another firm belonging to the same industry is inter-firm comparison.

Explanation:

Inter-firm comparison refers to evaluating and comparing the financial performance, data, or ratios of two or more different businesses that operate within the exact same industry. For example, comparing the profit margins or balance sheets of Tata Motors with Maruti Suzuki represents a standard inter-firm analysis. The prefix “inter” explicitly denotes a comparison between or across different external entities.

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Chapter 2: Financial Statement Analysis - QUESTIONS [Page 2.9]

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TS Grewal Accountancy Analysis of Financial Statements [English] Class 12
Chapter 2 Financial Statement Analysis
QUESTIONS | Q 12. | Page 2.9
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