Determining the financial health of the company


Problem:

If you were to get a physical from your Doctor and they only took your blood pressure prior to stating that you are in good health, would you be concerned? If you have noticed in your readings starting in Chapter that there has been explanation of the methods by which you could determine the financial health of a company. Name one and explain how it is computed? Which financial statement(s) does the input come from? Most importantly, what does it tell you about the financial performance or health?

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Finance Basics: Determining the financial health of the company
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