Question $18(1$ point$)$

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Which of the following statements regarding vertical analysis is not true?

Vertical analysis may be prepared for several periods to analyze changes in relationships over time.

In a vertical analysis of a balance sheet, each asset item is stated as a percent of total assets.

In a vertical analysis of an income statement, each item is stated as a percent of total expenses.

Major differences between a company's vertical analysis and industry averages should be investigated.