What does ratio analysis involve?
A)analyzing financial statements in order to appraise a firm's stock market position and strength
B)analyzing balance sheets in order to appraise a firm's financial position and strength
C)analyzing technical chart patterns in order to appraise a firm's financial position and strength
D)analyzing financial statements in order to appraise a firm's financial position and strength

Question

Quizplus · Accepted Answer

Ratio analysis involves analyzing financial statements (such as income statements and balance sheets) in order to appraise a firm's financial position and strength. It involves calculating and interpreting financial ratios in order to identify trends and compare a company's performance to industry benchmarks or previous periods.

What Does Ratio Analysis Involve