You have been given the financial statements and asked to analyze the financial performance of your division. Other managers have suggested you use financial ratios in your analysis. What are financial ratios? Which ratios might you use in your analysis? List them and explain what information they provide. How would you use them to make managerial decisions?
The response addresses the queries posted in 411 Words, APA References.
Financial Ratios are the worthful and easiest technique for the analysis of financial statements or position of the company. It helps to present the information of the financial statements in modified, systemized and summed up form by establishing the quantifiable relationship of the items or group of items of financial statements. It mainly reflects the company's financial strength and weakness and also, how well the business is being executed (Financial Ratios, 2008). The list of the ratios used in financial analysis is as follows: Liquidity ratio, Expenses ratio, Return on equity, Price Earning ratio and Assets turnover ...
This solution identifies and discusses the use of key financial ratios in management decision making in 411 words with two APA references.