Quick Ratio (Acid-Test Ratio) is ratio between the most liquid assets and Current Liabilities. It deals with the firm’s most liquid assets.
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Current Ratio is ratio between Current Assets and Current Liabilities. It compares Current Assets with Current Liabilities of the business.
Net Profit Margin (NPM) is one of the profitability ratios between Net Profit Before Interest and TAX, and Sales Revenue. Check more details.
Gross Profit Margin (GPM) is ratio between Gross Profit and Sales Revenue. It compares Gross Profit with Sales Revenue.
Internal Users and External Users of Final Accounts will find Ratio Analysis of great help when making business decisions.
Each stakeholder group will want to know different information about a business, therefore will analyze Final Accounts differently.
Different types of ratios are used to analyze information from Profit and Loss Account (P&L Account) and Balance Sheet to judge financial performance.
Ratio Analysis helps to compare business performance using historical comparisons and using current comparisons between different companies.
Ratio Analysis is a quantitative management tool used for analyzing the financial performance of a business organization.
There is a number of different methods accountants can use to calculate depreciation of Fixed Assets in Balance Sheet. Straight-Line Method. Reducing Balance Method.
Depreciation is a decrease in the value of Fixed Assets. Some assets such as Equipment (machinery) and Vehicles tend to fall in value over time.
Inventories are unsold ready goods, might also be in the form of raw materials and components, or some are in the process as work in progress.