- A company’s financial statements consist of the balance sheet, income statement, and statement of cash flows. Describe what each statement tells us and their limitations.
- What is the purpose and importance of financial analysis? What are financial ratios? Describe the “five-question approach” to using financial ratios. What are the limitations of financial ratio analysis? If we divide users of ratios into short-term lenders, long-term lenders, and stockholders, in which ratios would each group be most interested, and for what reasons?
Sample Solution
