【正文】
resulting in being unable to meet customer needs and lost the market shares,unable to pay for employee。 managers’failing to control project costs。Financial statement analysis and interpretation ? Objectives: Identify the major categories of ratios Calculate important ratios Explain the significance of the ratios Knowledge the limitations of ratios Knowledge the use of ratios in helping to predict financial distress ? Key words: financial ratios Financial ratios ? Definition: ? a ratio expresses the relation of one figure appearing in the financial statements to some other figure appearing there.(e. profit in relation to sales) ? Advantage to use ratios: eliminate the scale factor paring with the absolute items analysis.(A5000, P500。 owners are unable to inject further funds。 and then at the extreme,resulting in collapse in business. Solution: it should cut back its level of operations in line with existing finance available. The use of ratios in predicting financial distress Development of the ratio analysis: Univariate analysis (單一比率分析 ) nature/example:analysis one ratio at a time. weaknesses:different ratios analysis may lead to different financial signals in practice, even lead to conflicting signals. Multiple discriminate analysis(MDA多比率分析 )regression analysis nature: example:a discriminate function Limitations of ratio