Which of the following statements is not correct?

(a) A ratio reflects a business model relationship between two or more variables.

(b) When using comparative ratio analysis, it is important to remember that the causal relationship behind a certain value of a ratio may not apply similarly to the two different entities.

(c) Ratio analysis is rarely used for interpreting financial statements.

(d) A ratio calculation is generally the first step in an investigative research to get to the root cause of the situation described by the financial statements.

AppendixLO1