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Financial Management

Financial ratios are important to the understanding of the financial health of a company. You and your colleagues work for a financial services firm. Your are discussing the merits of the various financial ratios.

Identify four financial ratios and state what they tell you about a firm and why it's important to understand what these ratios mean to both a bank and an investor. Be sure to include your reasoning regarding these issues.

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The response addresses the queries posted in 375 Words, APA Reference

Starbucks Corporation: Ratio Analysis

Current Ratio

Current ratio of Starbucks Corporation is .9:1. The industry average is also same at .9:1 (Starbucks Corp: Key Ratios, 2009).Generally current ratio of 2:1 is considered as ideal. Overall, the liquidity position of the firm is quite satisfactory and company has the ability to meet its short term obligations as when they are due. The reason behind satisfactory liquidity position is the industry average.

Average Collection Period

Average collection period is 11.55 days. The industry average is 14.37 days (Starbucks Corp: Key Ratios, 2009).This ...

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The response addresses the queries posted in 375 Words, APA Reference

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