Financial ratio analysis designed the relative strengths and weakness of business operations. It also provides a framework for financial planning and control. Financial managers need the information provided analysis both on to evaluate the firm's past performance and to map future plans. Financial statement analysis involves a study of the relationship between income statement and balance sheet accounts, how these relationship change over time and how a particular firm compares with other firms in its industry .Although financial analysis has limitations, when used with care and judgment, it can provide some very useful insights into the operations of a company.
There are many types of financial ratios. they are as follows:
1.Liquidity ratio
a. current ratio
b.Quick ratio
2.Assets management ratio
a.Inventory turnover ratio
3.Debt ratio
4.Profitability ratio
5.Market value ratio
There are many types of financial ratios. they are as follows:
1.Liquidity ratio
a. current ratio
b.Quick ratio
2.Assets management ratio
a.Inventory turnover ratio
3.Debt ratio
4.Profitability ratio
5.Market value ratio
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