18.Which of the following statements is false about vertical analysis?

a.It is useful for analyzing changes in financial statements over time.

b.Each line item is expressed as a percentage of some total or key amount within the same statement.

c.The dollar amount of change in each line item is calculated.

d.It is useful for analyzing relationships within a financial statement.

19.The following are line items from the vertical analysis of an income statement:

Amount Percent

Total revenues $600 300%

Total expenses 400 200Net income$200100%

What needs to be changed on the statement?

a.Total revenues should be the base expressed as 100%.

b.The percentage for net income should 25%.

c.The percentage for total expenses should be 33%.

d.None of these changes should be made.

20.Vertical analysis can be used to analyze changes

a.on a balance sheet.

b.over time.

c.on an income statement.

d.All of these choices are correct