Question

One reason that a common-sized statement is a useful tool in financial analysis is that it enables the user to do what?

Answer 1

It helps to compare two companies in the same industry.

Step-by-step explanation:

A common-size statement is a critical tool in the financial analysis, as it helps to compare two companies with different size. It is a type of income statement where every feature is represented in the percentage, which helps to compare two companies effectively. Overall, it is an important indicator to measure strength and weakness in a company.