Can you please explain an example of ratio analysis before? Where
would it be helpful? Where could it hurt?
<br>Here is your answer:
<br>Ratio analysis is an excellent method for determining the overall financial condition of your small business. It puts the information from a financial statement into perspective, helping to spot financial patterns that may threaten the health of your company.
<br>Ratios are also very useful for making comparisons between your business and other businesses in your industry. For example, comparing ratios can indicate whether a business is holding too much inventory or collecting receivable too slowly. This ...
This question involves the fundamentals of ratio analysis.