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Unformatted text preview: When a business person understand how to read a financial report the information on that report can be used to make business decisions about many aspects of the business. For example, if a business' operating profit is seen to decline for a time then the managers would need to make changes to decrease costs and to obtain lower cost materials. If managers see that accounts receivable are not being collected then that may be an indication that they need to be stronger in their collection efforts or more careful in whom they allow to purchase on credit. Also, if they realize that even when sales are rising their cash flow is not rising, then that can tell them to alter their collection and payment patterns....
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- Spring '11