In regards to benchmarking,which of the following statements is incorrect?
A) Benchmarking is the practice of comparing a company with other leading companies.
B) The industry average is not a useful benchmark for evaluating a company.
C) Providing common-size percentages in a graphical manner highlights differences.
D) The two main types of benchmarks in financial statement analysis include benchmarking against the industry average and benchmarking against a key competitor.

Question

Quizplus · Accepted Answer

The industry average can be a useful benchmark for evaluating a company as it provides a reference point for comparison. However, it should not be the only benchmark used and should be considered alongside other benchmarks such as competitor analysis.

In Regards to Benchmarking,which of the Following Statements Is Incorrect