Question

Which one of the following items is not a method/tool of analysis of financial statements?

Options

• Trend Analysis

• Statement of Affairs

• Cash Flow Statement

• Comparative Statements

Answer 1

Statement of affairs

Explanation:

Tools of financial statement analysis typically include Trend Analysis, Cash Flow Statement, Comparative Statements, Ratio Analysis, Common Size Statements, and Fund Flow Statement. The Statement of Affairs is more of a financial position statement prepared in insolvency or liquidation scenarios and is not a method or tool used for analyzing financial statements in regular financial analysis.