David Lemay is the chief executive officer of Brenna Electronics. Lemay is an expert engineer but a

Question:

David Lemay is the chief executive officer of Brenna Electronics. Lemay is an expert engineer but a novice in accounting. Lemay asks you, as an accounting student, to explain (a) the bases for comparison in analyzing Brenna’s and (b) the limitations, if any, in financial statement analysis.
Instructions
Write a memo to David Lemay that explains the basis for comparison and the factors affecting quality of earnings.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...