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What Are Ratios, and Why Are They Important? When we do financial statement analysis, why do we need to study ratios? Why can't we just

What Are Ratios, and Why Are They Important?


When we do financial statement analysis, why do we need to study ratios? Why can't we just look at dollars of sales, dollars of debt, or dollars of profit?

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1 Ratios are numerical comparisons that express the relationship between two or more quantities They are important because they provide a concise way to analyze and interpret financial information mak... blur-text-image

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