Question #24
Reading: Reading 13 Integration of Financial Statement Analysis Techniques
PDF File: Reading 13 Integration of Financial Statement Analysis Techniques.pdf
Page: 13
Status: Correct
Correct Answer: A
Question
Wanda Brunner, CFA, is analyzing Straight Elements, Inc., (SE). SE is a discount manufacturer of parts and supplies for the railroad industry. She has followed her firm's suggested financial analysis framework, and has assembled output from processing data. When applying the financial analysis framework, which of the following is the best example of output from processing data?
Answer Choices:
A. Common-size financial statements
B. A written list of questions to be answered by the analysis
C. Audited financial statements
Explanation
Common-size financial statements are created in the data processing step of the
framework for financial analysis. Audited financial statements would be obtained during
the "collect input" phase of the financial analysis framework. Creating a written list of
questions to be answered by the analysis is part of the "define the purpose" phase of the
financial analysis framework.