Tag Archives | Financial Analysis

Balance Sheet and Revenue Statement Ratios

This article throws light upon the top two types of balance sheet and revenue statements ratios. The types are: 1. Turnover or Velocity Ratios 2. Profitability Ratios. Type # 1. Turnover or Velocity Ratios: (a) Stock/Inventory-Turnover Ratio: This ratio shows the relationship between inventory at close of the business and the overall turnover. In other […]

Cash Flow Statement: Meaning, Importance and Preparation

After reading this article you will learn about Cash Flow Statement:- 1. Meaning of Cash Flow Analysis 2. Importance of Cash Flow Statement3. Limitations 4. How to Prepare?. Meaning of Cash Flow Statement: A Cash Flow Statement is a statement which is prepared by acquiring Cash from different sources and the application of the same […]

Funds Flow Statement: Concept, Objectives and Preparation

After reading this article you will learn about Funds Flow Statement :- 1. Introduction to Funds Flow Statement 2. Concept of Funds Flow Statement 3. Funds Flow Statement 5. Object of Preparing a Fund Flow Statement 6. Parties Interested 7. How to Prepare 8. Funds Flow Statement and Income Statement 9. Funds Flow Statement and […]

Financial Ratio Analysis: Definition, Importance and Limitations

After reading this article you will learn about Financial Ratio Analysis:- 1. Introduction to Financial Ratio Analysis 2. Definition of Financial Ratio Analysis 3. Importance 4. Limitations 5. Interested Parties. Contents: Introduction to Financial Ratio Analysis Definition of Financial Ratio Analysis Importance of Financial Ratio Analysis Limitations of Financial Ratio Analysis Interested Parties of Financial […]

Revenue Statement Ratios

This article throws light upon the top three types of revenue statement ratios. The types are: 1. Expenses Ratio 2. Earning Ratios 3. Profit Cover Ratios. Type # 1. Expenses Ratio: (a) Fixed Expenses to Total Cost Ratio: It indicates the idle capacity in the organisation. If this ratio gradually increases without, however, a corresponding […]

Notes on Standard Ratio

An analyst irrespective of his cast and creed has; however, to bear in mind that, interpretation of Financial Statements of a firm with the help of ratios becomes significant and meaningful when the same is accomplished in the backdrop of some established Standard in this regard. This Standard depends upon the own experience of the […]

Inter-Firm Comparison: Introduction, Advantages and Limitations

After reading this article you will learn about Inter-Firm Comparison:- 1. Introduction to Inter-Firm Comparison 2. Purpose of Inter-Firm Comparison 3. Advantages 4. Limitations 5. Utility 6. Inter-Firm Comparison through Ratio Analysis 7. Centre. Contents: Introduction to Inter-Firm Comparison Purpose of Inter-Firm Comparison Advantages of Inter-Firm Comparison Limitations of Inter-Firm Comparison Utility of an Inter-Firm […]

Balance Sheet Ratios Types

This article throws light upon the top six types of balance sheet ratios. The types are: 1. Current Ratio 2. Liquid Ratio 3. Absolute Liquidity Ratio 4. Proprietary Ratio 5. Assets to Proprietorship Ratio 6. Debt-Equity Ratio. Type # 1. Current Ratio: In the last decade of the 19th century, when the number of Financial […]

Ratio Analysis: Definition and Limitations | Cost Accountancy

In this article we will discuss about Ratio Analysis:- 1. Definition of Ratio Analysis 2. Limitations of Ratio Analysis. Definition of Ratio Analysis: Ratio Analysis is a powerful tool of financial analysis. A ratio is defined as “the indicated quotient of two mathematical expressions and as the relationship between two or mm thing?” — Webster’s […]

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