Question
What would be a good response to this statement? A business that I would like to work for is Lexus, which is an automotive company.
What would be a good response to this statement?
A business that I would like to work for is Lexus, which is an automotive company. My husband and I are both Lexus owners, and since we purchased our vehicles, we have had absolutely no issues! However, if I was the financial manager for this business, I would use profitability ratios and solvency ratios to be able to work efficiently in my daily operations. Profitability ratios is where a company will evaluate its ability to earn profits from sales, balance sheet assets, or shareholders' equity (Profitability Ratios: What They Are, Common Types, and How Businesses Use Them, 2022). This type of ratio also can indicate how well a company can generate profits for shareholders. Having this type of ratio, especially in the car industry, can help the company create better plans for the future and also have a better judgement on how the company is performing financially. On the other hand, solvency ratios are another great essential to have a part of a financial managers daily operation because with solvency ratios, you are looking at the long-term debts of a company (What Is a Solvency Ratio, and How Is It Calculated?, 2023). Solvency ratios are also used when being evaluated by prospective lenders and potential bond investors. Profitability ratios and solvency ratios both add character to a company because of them giving a company more structure and organization that can help build the business to becoming greater than before.
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