Question #14
Reading: Reading 19 Equity Valuation - Applications and Processes
PDF File: Reading 19 Equity Valuation - Applications and Processes.pdf
Page: 6
Status: Incorrect
Correct Answer: B
Your Answer: A
Question
An analyst is most likely to review the footnotes to a firm's financial statements to find information about the firm's:
Answer Choices:
A. cash flow activities
B. accounting practices
C. operation
Explanation
A number of important disclosures regarding a firm's accounting practices and the basis
on which income and expense are recognized are contained in the footnotes to the
financial statements. The profit and loss statement provides information on the operation
of the firm. The statement of cash flows is the best source of data on a company's cash
flow activities such as operating, investing and financing.