Which of the following would be most helpful in the comparison of different size companies?
A)horizontal analysis
B)comparison of their net incomes
C)comparison of their working capital balances
D)preparation of common-size financial statements

Question

Quizplus · Accepted Answer

Preparation of common-size financial statements would be most helpful in comparing different size companies because it adjusts the financial statements to show percentages of each line item in relation to total assets or revenues. This allows for more accurate comparisons between companies of different sizes. A, B, and C may also provide some insights, but they do not adjust for size differences and may not provide a fair comparison.

Which of the Following Would Be Most Helpful in the Comparison