- CFA Exams
- CFA Level I Exam
- Topic 4. Financial Statement Analysis
- Learning Module 1. Introduction to Financial Statement Analysis
- Subject 1. Steps of Financial Statement Analysis
CFA Practice Question
An analyst's examination of the performance of a company is least likely to include an assessment of a company's ______.
B. cash flow generating ability
C. assets relative to its liabilities
A. profitability
B. cash flow generating ability
C. assets relative to its liabilities
Correct Answer: C
Assessment of performance includes analysis of profitability and cash flow generating ability. The relationship between assets and liabilities is used to assess a company's financial position, not its performance.
User Contributed Comments 4
| User | Comment |
|---|---|
| tricorp | OK.... |
| ascruggs92 | Semantics |
| seanj951 | Wouldn't 'cash flow generating ability' be its potential not it's performance? |
| sshetty2 | think about it.. if you're looking at debt to equity ratio's you would be examining a company's relative solvency. This is not necessarily related to their performance. |