There are several groups of ratios most decision makers and analysts use to examine different aspects of a company's performance. Based on the Ratio analysis

A company reports accounting data in its financial statements. This data is used for financial analyses that provide insights into a company's strengths,

weaknesses, performance in specific areas, and trends in performance. These analyses are often used to compare a company's performance to that of

its competitors or to its past or expected future performance. Such insight helps managers and analysts improve their decision making.

Consider the following scenario:

You work for a brokerage firm, Your boss asked you to analyze Blue Parrot Manufacturing's performance for the past three years and to

write a report that includes a benchmarking of the company's performance.

Which of the following components would be best for you to include in your financial statement analysis?

A critique of the company's financial statements and a report of any misprints to be sent to the Securities and Exchange Commission

A calculation of financial ratios and an evaluation of the comparative trends in the firm's financial position ind performance over a certain

time period

There are several groups of ratios most decision makers and analysts use to examine different aspects of a company's performance. Based on the

descriptions of ratios listed, identify the relevant catepory of ratios.

descriptions of ratios listed, identify the relevant category of ratios.

Ratios that help determine whether a company can access its cash and pay its debts that mature in less than a year are called

ratios.

These ratios, which help determine how efficiently a firm is using its assets to generate sales are called

ratios.

Ratios that help assess a company's ability to service the interest and repayment obligations on its long$-$term debt and the degree to which it uses

borrowed versus invested financial capital are called

ratios.

ratios help measure a company's ability to generate income and profits based on its invested

capital.

ratios examine the market value of a company's share price, its profits and cash dividends, and

the book value of the firm's assets and relate them to other data items to determine how the firm is perceived in the stock market.

Ratio analysis is an important component of evaluating company performance. It can provide great insights into how a company matches up against

itself over time and against other players within the industry.

However, like many tools and techniques, ratio analysis has a few limitations and weaknesses.

Which of the following statements represent a weakness or limitation of ratio analysis? Check all that apply.

Different firms may use different accounting practices.

A firm may operate in multiple industries.

A firm's financial statements show only one period of financial data.