Match List-I with List-II
| LIST-I | LIST-II | ||
|---|---|---|---|
| (A) | Comparative Statement | (I) | Expressing all items as % of a common base. |
| (B) | Common Size Statement | (II) | Determining direction of movement over several years |
| (C) | Ratio Analysis | (III) | Evaluate relationship among items of a balance sheet and a statement of profit and loss of a firm. |
| (D) | Trend Analysis | (IV) | Shows changes in items over two or more periods |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → (A) - (IV), (B) - (I), (C) - (III), (D) - (II)
Each tool of analysis answers a different question about the financial statements: how items changed, how they are made up, how they relate to one another, and which way they are moving over the years.
(A) Comparative Statement — this matches (IV) Shows changes in items over two or more periods. It sets the statements of two or more periods side by side, so the change in each item can be seen.
(B) Common Size Statement — this matches (I) Expressing all items as % of a common base. Each item is shown as a percentage of one common item, so firms or years of different size can be compared.
(C) Ratio Analysis — this matches (III) Evaluate relationship among items of a balance sheet and a statement of profit and loss of a firm. Ratios measure the relationship between items of the two statements.
(D) Trend Analysis — this matches (II) Determining direction of movement over several years. It studies items over a series of years against a base year, to see whether they are rising, falling or steady.
NCERT (2026-27 edition): |