Tools can be used for financial statement analysis
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What tools can be used for financial statement analysis? What do these tools tell you about financial performance? What kinds of business decisions can be made using these tools?
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Response provides help with respect to analyze the tools which can be used for financial statement analysis
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What tools can be used for financial statement analysis?
The tools which can be used are financial ratios, comparative financial statements, trend analysis and other related measures.
What do these tools tell you about financial performance? What kinds of business decisions can be made using these tools?
The purpose of the financial statement analysis is to provide relevant information to all the stakeholders of the organization which will help in their decision making. This also helps in comparing the performance of the organization and used in the control of the organization. Different users of financial ratios may (bankers, investors, the company) interpret financial ratios in different manner. Bankers are interested in knowing about the solvency of the organization. They will be interested in solvency rations such as debt ratio, debt equity ratio and interest coverage ratio. Investors will be interested in knowing the returns that they can earn on their investments. They will be ...
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