Ratio analysis and its uses, Accounting Basics

Assignment Help:

Ratio Analysis: A 'Ratio' is  clear as an  arithmetical/quantitative/ numerical relationship between two numbers. Ratio analysis is a extremely significant and age old method of financial analysis.

Uses of Ratio Analysis:  There are a variety of uses of Ratio Analysis, some of which are like this:

1. It assists in managerial decision making

2. It assists in financial planning and forecasting

3. It assists in communicating the financial strength of a concern

4. It assists in control

5. It is a critical part of budgetary control and standard costing

6. It assists an investor/prospective investor in decision making

7.It offers information to the creditors concerning the solvency of the firm

8.It assists the employees by providing information about the profitability of the concern

9. It assists the government in policy making by provided that financial information about the industry/firm etc

10. It makes easy inter-firm, intra-firm, and firm industry contrast.


Related Discussions:- Ratio analysis and its uses

What is depreciation, Q. What is Depreciation? Depreciation -- an expen...

Q. What is Depreciation? Depreciation -- an expense which is supposed to reflect the loss in value of a fixed asset. Forinstance if a machine will entirely wear out after ten y

Help., How would I do this make it and adjustment account revenue 300.00 of...

How would I do this make it and adjustment account revenue 300.00 of supplies on hand 100.00 of unearned revenue is still unearned at the end of the month Accured salaries are 280

Net book value, When we say an asset is at its Net Book Value, Does that me...

When we say an asset is at its Net Book Value, Does that mean Cost of asset + Revaluation added - Accumulated Depreciation or Revaluation is not relevant for calculating the NBV?

An invoice for product x totals $1, An invoice for product X totals $1,200 ...

An invoice for product X totals $1,200 and is dated July 6, 2000 with terms 2/10-60X. If the invoice is paid on September 3, 2000, what is the net amount of payment? A. $912

Internal control devices for banking activities, Internal control devices f...

Internal control devices for banking activities include signature cards, deposit tickets, checks, and bank statements. 01.) True 02.) False True or False?

Branch accounting, Mohan brothers invoiced goods to their branch at cost pl...

Mohan brothers invoiced goods to their branch at cost plus 33.33%. All the cash collected by branch is banked on the same day to the credit of head office. All expenses are paid by

Calculate traditional manufacturing overhead allocation rate, The following...

The following was taken from the records of the Frederic Products Company for 200X: 5) y for 200X: Total estimated manufacturing overhead cost for the year is $288,750 Total

hfc ltd’s shareholders, HOME Finance Company Limited made an after-tax pro...

HOME Finance Company Limited made an after-tax profit of $3.172 million for the year ended June 30, 2008. Chairman James Datta said this was a milestone for the company, with a

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd