The ________ classification has been on the basis of financial statements to which the determinants of ratios belong.

Modern

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Traditional

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Functional

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None of the above

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Solution

The correct option is A Traditional

In Traditional classification the basis is the financial statement to which the determinants belong. For example balance sheet ratios, profit and loss ratios etc.

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Similar questions

Why is it important to adopt a consistent basis for the preparation of financial statements? Explain.

Which of the following statement is true?

Statement A: Financial statements are prepared on the basis of accounting principles.

Statement B: Any changes in the accounting principles or method will affect the utility of the financial statements.

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