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Users of Financial Ratio Analysis

1.There are several different groups that use financial ratio analysis. Who are these groups and what are the primary concerns of each?
2.It has been said that a balance sheet is a snapshot of the firm at some point in time. What does this mean? How does it differ from what the income statement is showing?
3.What is the primary objective of the financial manager? Explain your answers.

Use specific examples, and cite your sources.

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Financial Analysis

1. There are several different groups that use financial ratio analysis. Who are these groups and what are the primary concerns of each?

Ratios help us in understanding the performance of the organization. It is the relationship between two or more financial figures. It is used for:
1) To identify the strengths and weaknesses of the organization.
2) To evaluate the performance of the organization.
3) To facilitate the comparison.
4) To do bench-marking.
5) To control the performance of the organization.
Several different groups that use financial ratio analysis:
1) Investors
Primary concern for investor is ...

Solution Summary

Solution discusses about several different groups that use financial ratio analysis

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