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How you would consider financial analysis. What are some of

How you would consider financial analysis. What are some of the characteristics of income statement, balance sheet and cash flow statement - from the perspective of the story told by each statement?
How does accrual accounting come into play in statements?

It is true that certain 'sets' of ratios tend to be used more by credit analysts, others by financial managers.

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How you would consider financial analysis.

When conducting a financial analysis, it is to analyze the company's financial statements. By doing so, the analyst is able to determine three different things: 1) the viability of a business, which tells the analyst if the business has a reasonable chance of growing as expected along a normal rate of growth. 2) It shows the analyst, based on a preliminary analysis, the rate of profitability of the business. If profits are showing that they are constant or (hopefully) improving, the company is considered to be a sound investment for investors, creditors, and others with an interest in the business. The financial analysis also tells the analyst if the company has stability. A financial analysis will show if the operations are at a point where stability is reasonably certain, or do the financial statements show, through a comprehensive financial analysis, that the company is unstable and/or on the verge of decline.

What are some of the characteristics of income statement, balance sheet and cash flow statement - from the perspective of the story told by each statement?

If they ...

Solution Summary

How you would consider financial analysis. What are some of the characteristics of income statement, balance sheet and cash flow statement - from the perspective of the story told by each statement?
How does accrual accounting come into play in statements?

It is true that certain 'sets' of ratios tend to be used more by credit analysts, others by financial managers.

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