Ratio analysisu202fcomparesthelineitem datain a firmsu202ffinancial statements which willrevealmanyunderstandings regarding liquidityprofitability operational efficiency and solvency.u202fMoreover ratioanalysisu202fcan be used to look at

Ratio analysis
line-item data
in a firms
u202ffinancial statements, which will
understandings regarding liquidity,
profitability, operational efficiency, and solvency.
u202fMoreover, ratio
u202fcan be used to look at trends for one
or more
firms within the same industry
or sector.
Ratio analysis compares line-item data.
Respond to the following in a minimum of 175 words:
List the 3 major categories of ratios and explain how they could be used to help a firm.
What are the most important liquidity ratios and why?


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