Ratio analysis Flashcards
1
Q
Ratio analysis
A
Form of financial statement analysis that is used to obtain a quick indication of a business’s financial performance in several key areas
Covers
- statement of comprehensive income (profit and loss)
- statement of financial position/ balance sheet)
2
Q
Why is it important
A
Helps business see how its performing and how it compares to last year and year before or against competitors
Ration analysis provide
-profitability
-liquidity
-efficiency
3
Q
Types of profitability raptor
A
Gross profit margin
Net profit margin
Mark up
Return on capital employed
