Definition, Categories, Use Ratio analysis is referred to as the study or analysis of the line items present in the financial statements of the company. It can be used to check various factors of a business such as profitability, liquidity, solvency and efficiency of the company or the business.
What is ‘Ratio Analysis’. A ratio analysis is a quantitative analysis of information contained in a companys financial statements. Ratio analysis is used to evaluate various aspects of a companys operating and financial performance such as its efficiency, liquidity, profitability and solvency.
The current ratio is a liquidity ratio that measures a company’s ability to cover its short-term obligations with its current assets. Horizontal analysis is used in financial statement analysis to compare historical data, such as ratios or line items, over a number of accounting periods. Ratio analysis an introductionThe ratio analysis is a method of analyzing a product by comparing it to other products in the market the primary goal of this method is to determine the. The ratio analysis (or ratio analysis) is a technique for comparing two or more products to each other and to other available products or services in order to. Ratio analysis: one of three types of analysis used to compare products and services; the three types are comparative analysis, comparative cost analysis, and.