Financial Ratio Analysis: The Performance of General Motors
The financial health of a firm plays a significant role in its survivability and long-term success. Companies record and track their operational activities on financial statements, such as the balance sheet and income statement.
The Securities and Exchange Commission (SEC) mandates and enforces organizations that trade in the United States (US) to maintain accurate accounting statements and report them to the SEC. The SEC's purpose is to protect investors and the public from fraudulent and manipulative business practices (Investopedia, 2017).
Although accounting statements show a glimpse of a company's performance, they do not provide a complete representation of a firm's financial standings. Investors, creditors, managers, and other users must apply various measuring tools to determine the overall strength of their companies.
This report will evaluate the performance of General Motors (GM) by conducting solvency, turnover, and profitability ratio analyses of its financial statements. Managers that effectively utilize measuring techniques will make better decisions to improve the efficiency of their resources and increase the wealth of their shareholders (Ingram, 2017).
Attachment:- General Motors.rar