Tag Archives | Accounting Ratios

Accounting Ratios: Importance and Limitations

Accounting Ratios: Importance and Limitations! Importance of Accounting Ratios: The importance of accounting ratios, that is, relationships worked out among various accounting data which are mutually interdependent and which influence each other in a significant manner, arises from the fact that often absolute figures standing alone convey no meaning. They become significant only when considered […]

4 Main Types of Accounting Ratios

The following points highlight the four main types of accounting ratios. The types are: 1. Return on Investment 2. Profitability Ratios 3. Return on Proprietors’ Funds 4. Return on Equity Capital. Accounting Ratios: Type # 1. Return on Investment: Profitability or the Return on Investment is the basic casual ratio. It is ascertained by a […]

Predictability of Insolvency on the basis of Ratios

In this article we will discuss about the Predictability of Insolvency on the basis of Ratios. Edward 1. Altman of U.S.A. has developed a model on the basis of which insolvency of a firm can be predicted— this has been developed on the basis of empirical research conducted by him. In Altman’s view, the Z’ […]

shopify traffic stats