abhishreshthaa
Abhijeet S
COMPARISONS BY RATIOS
Accounting ratios are very useful in assessing the financial position and profitability of a business enterprise. This can be achieved through comparison by ratios. Such a comparison may take any of the mentioned forms:
For the same enterprise over a number of years (horizontal analysis)
For one enterprise against another in the same industry (dimensional analysis).
For one enterprise against the industry as a whole.
For one enterprise against the pre-determined standards.
For inter-departmental comparisons within an organization.
Accounting ratios are very useful in assessing the financial position and profitability of a business enterprise. This can be achieved through comparison by ratios. Such a comparison may take any of the mentioned forms:
For the same enterprise over a number of years (horizontal analysis)
For one enterprise against another in the same industry (dimensional analysis).
For one enterprise against the industry as a whole.
For one enterprise against the pre-determined standards.
For inter-departmental comparisons within an organization.