Objectives of financial statement analysis, Accounting Basics

OBJECTIVES OF FINANCIAL STATEMENT ANALYSIS

Financial Statements are analyzed by dissimilar users for dissimilar purposes. Some of the purposes are as under-

1. To recognize and approximation the present and potential profitability/earning ability of the enterprise

2. To aid in economic decision making

3. To estimate and understand the financial performance and position of the concern

4. To calculate the effectiveness of business operations

5. To compute and analyze the different financial ratios and flow of funds/cash

6. To recognize areas of mismanagement and possible danger so that corrective actions can be taken

7. To resolve the preservation of financial leverage by the project

8. To establish the movement of inventory in the enterprise

9. To recognize diversion of funds etc.

Posted Date: 10/15/2012 5:45:10 AM | Location : United States







Related Discussions:- Objectives of financial statement analysis, Assignment Help, Ask Question on Objectives of financial statement analysis, Get Answer, Expert's Help, Objectives of financial statement analysis Discussions

Write discussion on Objectives of financial statement analysis
Your posts are moderated
Related Questions
Hello, I'm having trouble understanding Direct Cost, Overhead Cost and Indirect Cost. ***Also Period cost and Product cost. please can anyone explain it and give examples for eac

Q. Starting inventory and net cost of purchases? Hanlon's start inventory (USD 24000) plus net cost of purchases (USD 166000) is equivalent to cost of goods available for sale

Hawkeye Electric Company engaged in the following transactions during July. Journalize the preceding transactions on the books of Hawkeye Electric Company using the perpetual sys

I am trying to figure out FIFO LIFO and AVERAGE COST of the ending inventory and the cost of goods sold.

Obtain the relevant authoritative literature on accounting for accounts receivable using the FASB's Codification Research System at the FASB website. What is the specific citation

State the term - Partnership A partnership exists where at least two individuals carry on a business together with intention of making a profit. Partnerships have much in commo

Needs the entries for the following scenarios: Capital accounts as follows : Mason ; 90,000 Jiri; 30,000 James; 60,000 a) Frank pays mason 25,000 for 20% of masons interest i

Q. Explain Interest revenue? Interest revenue Savings accounts exactly earn interest moment by moment. Hardly ever is payment of the interest made on the last day of the accoun

A store receives $400 cash after offering a chain discount of 10/10/5 on a good. What was the list price? A. $492.20 B. $519.82 C. $533.33 D. $612.00

Instructions: 1. Using the journal entry sheet provided, record the transactions for January. January is the first full month of operations. 2. After journalizing the transactio