Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Analysis of Financial Statements

Question:

When Financial Statements of two or more organisations are analysed, it is called :

Options:

Intra-firm Analysis

Inter-firm Analysis

Horizontal Analysis

None of these

Correct Answer:

Inter-firm Analysis

Explanation:

The correct answer is option 2- Inter-firm Analysis.

Inter-firm comparison technique is a method of self-analysis of the business by the businessmen themselves. The management of the business on the basis of results obtained from the self-analysis is bound to react and look around for means to improve its performance or increase productivity.