FIN200 Week 2 DQ 1

FIN200 Week 2 DQ 1 - • You are considering investing in a company Which financial ratios would you find most useful The significance of all

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Unformatted text preview: • You are considering investing in a company. Which financial ratios would you find most useful? The significance of all financial ratios is vital in determining which company to invest it. There are, however, certain financial ratios that are more relevant than others. In order to determine which ratios are most important, it is important to investigate the company’s market as a whole. As an example, ratios dealing with inventory and inventory turnover will be more significant in the manufacturing sector. However, all companies have to deal with the management of their cash. As such, liquidity ratios (examples: current ratio, quick ration) will be extremely important to determine and calculate. As eluded above, the most effective way for investor to determine the relative weight of various financial ratios in regards to evaluating the financial health of a corporation is to first...
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This note was uploaded on 01/04/2011 for the course FIN 200 taught by Professor Williams during the Spring '08 term at University of Phoenix.

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