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Relevance of financial statements relate mostly to its'...?

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a. Neutrality

b. Materiality

c. Comparability, or

d. Prudence.

What do you think the right answer is and why?

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  1. B. Materiality--because it shows the material worth or net worth of the company.  In particular, the balance sheet shows the net worth and the book value per share.  You can compare the book value per share against the going market price.

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