A evaluate a company’s past financial performance and explain how a company’s strategy is reflected in past financial performance;

Question 1

Evaluate a companys Financial Performance

Answer 1

Ratios, to assess a company’s profitability, leverage, solvency, and operation efficiency

Evaluate trends in these ratios, as well as their levels, to eval. how the company has performed in these areas.

Question 2

Explain how a companys strategy is reflected in past financial performance

Answer 2

• Understand a subject firms business strategy

* Differences in financial statements exist between similar companies which have different strategies