Asked by Darby Fischer on May 26, 2024
Verified
The usefulness of financial statements in assessing the investment value of securities is always somewhat limited because:
A) the information in financial statements more subjective rather than objective.
B) companies are not always honest about their figures.
C) past performance may not be indicative of future performance
D) the information is often confusing.
Financial Statements
Formal records of the financial activities and position of a business, person, or other entity.
Investment Value
The worth of an asset or company to a particular investor, considering individual investment requirements and expectations.
Securities
Investment tools reflecting a stake in a publicly-listed company, a lending agreement with corporate or government entities (bonds), or the possession of options indicating a claim to ownership.
- Acquire knowledge of the parts of financial statements and their significance.
Verified Answer
JF
Johnny FontaineMay 27, 2024
Final Answer :
C
Explanation :
Financial statements provide information on past performance, but investors must also consider other factors such as the company's future prospects, industry trends, and macroeconomic conditions. Past performance may not always be indicative of future success or failure.
Learning Objectives
- Acquire knowledge of the parts of financial statements and their significance.