Ratios
Ratios
Projecting your Profits and Losses
Please make sure you have had sufficient review time in the Learning Activity this week in order to better understand the concepts you will use in both this Discussion and in the Assignment.
What questions do financial ratios help answer about a firm’s financial performance? What ratios might be of more interest to certain stakeholders and why?
Answer preview
The benefits of financial ratios to an organization are many. They are sued to restate the income statement so as to provide any form of information that may help the management of an organization o venture and compare its progress. Financial ratio analysis can simplify large and complex sets of information quickly and easily, as the ratios are calculated using basic division. Another advantage of financial ratio analysis is that it makes is very easy to compare firms against each other. Financial ratios of each firm can be easily compared, which allows investment decisions to be made more wisely…………………..
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