Managerial Accounting (15th Edition)

Published by McGraw-Hill Education
ISBN 10: 007802563X
ISBN 13: 978-0-07802-563-1

Chapter 15 - Financial Statement Analysis - Questions - Page 697: 15-2

Answer

By examining the trends, the analyst will be able to determine if a specific situation is changing by either improving or deteriorating or if it's remaining the same. This will help him take a further decision that will positively influence the company.

Work Step by Step

The importance of examining trends is represented by the fact that it can offer insight into what is most likely to happen in the near future.
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