Accounting ratio, Accounting Basics

A method of expressing the relationship between one accounting result and the other, which is intended to give a useful comparison. Accounting ratios helps in measuring the efficiency and profitability of a corporation based on its financial reports. Accounting ratios outline the basis of fundamental analysis. It is also known as financial ratio.

An accounting ratio compares two facets of a financial statement, like the relationship (or ratio) of current assets to current liabilities. The ratios can be used to assess the financial condition of a company, involving the company's strengths and weaknesses. An instance of an accounting ratio is the price-to-earnings (P/E) ratio of a stock. This calculates the price paid per share with relation to the profit gained by the company per share in a particular year.

Posted Date: 7/27/2012 3:42:51 AM | Location : United States







Related Discussions:- Accounting ratio, Assignment Help, Ask Question on Accounting ratio, Get Answer, Expert's Help, Accounting ratio Discussions

Write discussion on Accounting ratio
Your posts are moderated
Related Questions
Accounting Standards  The flexibilities offered by a choice of accounting treatments distinctly diminish, and even distort the comparability of relevant inform


Earned service revenue and received cash As its first transaction in July Metro performed deliverance services for customers and received USD 4800 cash. This transaction improv

Q. Income statements - Service and merchandising company? We evaluate the main divisions of an income statement for a service company with those for a merchandising company. To

If my company sells 4000 shares of common stock for $86,400, how do I record this in the Journal?

XYZ plc provides engineering and consultancy services to the oil and gas industry.  Over the past few years, they have incurred expenditure of £1m researching and developing a new

DEFINE THE FICA TAX PAYABLE AND SUTA TAX PAYABLE FICA TAX PAYABLE-OASDI. Same account is used to record both employees' and the employer's share. Credited to record taxes i


Q. Explain about Sales account? In theory sellers could record both sales allowances and sales returns as debits to the Sales account for the reason that they cancel part of th

Mission statement for PCAOB and AICPA and how it contributed to GAAP 2-3 pages APA style