BYP13-7 R.J. Falk is the chief executive officer of VenturaElectronics. Falk is

BYP13-7 R.J. Falk is the chief executive officer of VenturaElectronics. Falk is an expert engineer but a novice in accounting.Falk asks you as an accounting major to explain (a) the bases forcomparison in analyzing Ventura financial statements and (b) thelimitations if any in financial statement analysis. InstructionsWrite a memo (350-500 words) to R.J. Falk that explains the basisfor comparison and the factors affecting quality of earnings.