Final Answer:
On a common-base year financial statement, inventory for the current year will be expressed relative to d. Base Year Inventory (Option d).
Step-by-step explanation:
A common-base year financial statement is a tool used to analyze and compare financial data across multiple periods. When expressing inventory on such a statement, the relative comparison is made to the inventory of the base year. This allows for a consistent benchmark, facilitating a clear understanding of how the inventory has changed over time (Option d).
In the common-base year analysis, the Base Year Inventory serves as the reference point. The calculation for expressing the current year's inventory relative to the base year is given by the formula: Relative Inventory = (Current Year Inventory / Base Year Inventory) × 100. This formula provides a percentage that indicates whether the inventory has increased or decreased compared to the base year. By using the base year as a reference, analysts can better evaluate the performance and trends in inventory management.
In summary, on a common-base year financial statement, inventory for the current year is expressed relative to the Base Year Inventory. This approach enables a standardized comparison, aiding in the assessment of changes in inventory levels over time. The percentage obtained through this comparison provides valuable insights into the dynamics of inventory management within the context of the base year.