Discussion Post
Financial ratios are relationships between different accounts from financial statements-usually the income statement and the balance sheet-that serve as performance indicators. Being relative values, financial ratios allow for meaningful comparisons across time, between competitors, and with industry averages.
Five key areas of a firm's performance can be analyzed using the following financial ratios:
• Liquidity ratios
• Solvency ratios
• Asset management ratios
• Profitability ratios
• Market value ratios
What does each ratio do for a business?
The response should include a reference list. One-inch margins, Using Times New Roman 12 pnt font, double-space and APA style of writing and citations.