1. Principles of vertical analysis are used to prepare common size financial statements. A) True B) False

2 Factors such as industry trends and economic conditions should not be ignored when analyzing a company. A) True B) False

3. A common size income statement would report inventory as a percentage rate, not as a dollar amount. A) True B) False

4.The ability of a business to pay its debt is called liquidity.A) TrueB) False