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FINANCIAL

STATEMENT
ANALYSIS
CHAPTER 7
PREPARED BY: NURUL HASSANAH BINTI HAMZAH
OBJECTIVE OF FINANCIAL
STATEMENT ANALYSIS

To enable the To enable the


To identify the
business to take the business to improve
weaknesses as well
appropriate steps or its overall financial
as the strengths of a
actions to overcome situation in the
business
any weaknesses future
Type of ratio
analysis

Efficiency Profitability
Liquidity Ratios
Ratios Ratios

Average
Collection
Acid Test or Inventory Period or Gross Profit Net Profit
Current Ratio
Quick Ratio Turnover Ratio Debtor Margin Margin
Collection
Period
LIQUIDITY
RATIOS
Refer page 195 & 196
EFFICIENCY RATIOS
Refer page 196 & 197
PROFITABILITY RATIOS
Refer page 198 & 199
EXAMPLE
Part B Question 4 June 19

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