Question

State whether the following is True or False:

Financial analysis helps an analyst to arrive at a decision.

Answer 1

This statement is true.

Explanation:

Financial analysis helps an analyst make decisions because it converts raw financial statements into interpretable information through tools like ratio, trend, and comparative analysis that reveal a firm’s liquidity, solvency, profitability, and direction, and thus support investment, credit, dividend, and managerial decisions.