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 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 prion, 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 Itse over time and against other players within the industry. how a company matches up against However, ike 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 way Seasonal factors can distort data. Market data is not sufficiently considered Window dressing might be in effect. Grade It Now Save & Continue Continue without saving MacBook Air . 11 $ 4 3 % 5 & 7 6 00 * 9 0 E R T Y U 0 P D F G H J 4: Assignment - Analysis of Financial Statements Ratlo analysis 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 ture performance. Such Insight helps managers and analysts Improve their decision making. Consider the following scenario: You work as an analyst at a credit rating agency, and you are comparing firms in the construction and engineering sector. One company in the portfolio of companies you are analyzing is a Chinese firm. This form stands out in the ratio analysis, because the company's financial ratios are substantially lower than identical financial ratios of the other firms in the sector. You do not dissect the results of the ratio analysis and report this form as an under-performing company Which of the following statements about your analysis report is true? The analysis likely includes incorrect and misleading conclusions. The ratios provide an accurate and thorough representation of the Chinese company's performance Most decision makers and analysts use five groups of ratios to examine the different aspects of a company's performance Indicate whether each of the following statements regarding financial ratio is true or false Statement True False A company exhibiting a high liquidity ratio is likely to have enough resources to pay off its short-term obligations Asset management of activity ratios provide insights into management's efficiency in using a firm's working capital and long-term Debtor financial leverage ratios help analysts determine whether a company has sufficient cash to repay its short-term debt MacBook Air 30 909 000 > FB FVO A $ 4 * 3 % 5 & 7 6 8 9 0 E R T Y U I O
