Accounting for IGCSE & O level - Advanced Principles (Section 3 - No. 24)
In financial analysis, what is the main reason for comparing ratios over time?
To see how the business performs over a period of time.
To assess the current debts.
To increase the amount of profit
To assess the industry standards.
Explanation
You compare financial ratios over time to observe trends and see how the business is performing over the period of time.
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