Question: 1 . Differentiate between absolute and percentage changes. Which is generally a better measure of change? Why? 2 . Differentiate between horizontal and vertical analysis.

1 .

Differentiate between absolute and percentage changes. Which is generally a better measure of change? Why?

2 .

Differentiate between horizontal and vertical analysis. Using sales as a component for each type, give an example that explains the difference.

3 .

What is trend analysis? Can it be used for ratios? For absolute figures?

4 .

Suppose you are comparing two firms within an industry. One is large and the other is small. Will relative or absolute numbers be of more value in each case? What kinds of statistics can help evaluate relative size

5 .

Are managers the only users of financial reports? Discuss.

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