BUSINESS FINANCE I Dersi Financial Statements and Analysis soru detayı:

CEVAP:

Interpretation of the results of the trend and static (vertical) analyses might be difficult in some cases. For example, a user might want to know whether the assets are used efficiently – in other words, might want to assess the profitability of the firm as measured by the relationship between profits and assets, and profit and sales. Such a relationship can be expressed as a ratio. Ratios are easy to compute and they provide signals for possible difficulties, so all financial analysts use ratio analyses. However, ratios are hard to interpret by themselves.