Financial ratios are important to the understanding of the financial health of a company. You and your colleagues work for a financial services firm. You are discussing the merits of the various financial ratios. Identify four financial ratios, and state what they tell you about a firm and why it is important to understand what these ratios mean to both a bank and an investor. Be sure to include your reasoning regarding these issues.
Discussion Board Assignment Guidelines:
Financial ratio is defined as the comparison of two or more numbers of the company’s financial statement; it helps to evaluate the company’s performance (Kelley). Of the multiple financial ratios, the following have been chosen for this discussion board:
Ø Liquidity Ratios (“Financial statement analysis,”)
Ø Profitability Ratios (Brooks, 2013)
Ø Asset Management Ratios (Brooks, 2013)