P 5- 3 The Kelly Services, Inc., and Subsidiaries balance sheets from its 2010 annual report are presented in Exhibit 5- 4. Required

a. Using the balance sheets, prepare a vertical common- size analysis for 2010 and 2009. Use total assets as a base.

b. Using the balance sheets, prepare a horizontal common- size analysis for 2010 and 2009. Use 2009 as the base.

c. Comment on significant trends that appear in ( a) and ( b).

Multiple-choice questions: a. Which of the following statements is incorrect?

1. Ratios are fractions expressed in percent or times per year. 2. A ratio can be computed from any pair of numbers. 3. A very long list of meaningful ratios can be derived. 4. There is one standard list of ratios. 5. Comparison of income statement and balance sheet numbers, in the form of ratios, should not be done.

b. A figure from this year