Ratio analysis by Neeraj Bhandari ( Surkhet.Nepal )
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Ratio analysis by Neeraj Bhandari ( Surkhet.Nepal )

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    Ratio analysis by Neeraj Bhandari ( Surkhet.Nepal ) Ratio analysis by Neeraj Bhandari ( Surkhet.Nepal ) Presentation Transcript

    • Ratio analysis BBA-II Sharda university
    • Analysis & interpretation of financial statement
    • Analysis & interpretation of financial statement • analysis & interpretation of statement help business owners & others interested people to analyze the data with better information about such key factors for decision making & ultimate business survival
    • Financial analysis • Assessment of the firm’s past, present and future financial performance.
    • Ratio • Ratio:- a ratio is a simple arithmetical expression of relationship of one number to another or, • An expression of quantitative relationship between two numbers.
    • Ratio analysis • Ratio analysis is a tool of financial analysis, it is used as devices to analyze & interpret the financial health of enterprise. Ratio analysis means better understanding of financial strength & weakness of a firm.
    • Use/significance of ratio analysis • Helpful in analysis of financial strength • Helpful in decision-making • Help in financial forecasting • Help in financial planning
    • Types of Ratio • 1. Liquidity ratio:- current ratio, liquid ratio • 2. Solvency ratio: debt equity ratio, assets to debt ratio, proprietary ratio. • 3. Profitability ratio: gross profit ratio, net profit ratio, operating ratio, ROI • 4. Activity ratio: Inventory turnover ratio, debtors turnover ratio, creditors turnover ratio, working capital ratio