MANAGEMENT

Detailed explanation-1: -Financial statement analysis is the process of analyzing a company’s financial statements for decision-making purposes. External stakeholders use it to understand the overall health of an organization and to evaluate financial performance and business value.

Detailed explanation-2: -The general purpose of the financial statements is to provide information about the results of operations, financial position, and cash flows of an organization. This information is used by the readers of financial statements to make decisions regarding the allocation of resources.

Detailed explanation-3: -Financial Statement Analysis takes the raw financial information from the financial statements and turns it into usable information the can be used to make decisions. The three types of analysis are horizontal analysis, vertical analysis, and ratio analysis.

Detailed explanation-4: -a. Financial statements gives a summary of accounts.

Detailed explanation-5: -It shows projected profitability over a period. It is also a useful tool for comparing a company’s performance to others of similar size in similar industries. The data in the income statement helps inform decisions that control operating expenses and the cost of goods sold to keep profit margins intact.