Journal article
RATIO-ANALYSIS FOR THE SMALL BUSINESSMAN
Journal of small business management, Vol.13(1)
01 Jan 1975
Abstract
THE SMALL BUSINESS DOES NOT NEED A STAFF OF SPECIALIZED EXPERTS TO PERFORM RATIO-ANALYSIS, WHICH IS THE COMBINING OF DATA ON A FIRM'S INCOME-STATEMENT AND BALANCE-SHEET TO OBTAIN MEASURES OF PERFORMANCE AND FINANCIAL-CONDITION. ALL RATIOS FALL INTO FOUR BASIC CATEGORIES - LIQUIDITY, ACTIVITY, PROFITABILITY, AND SOLVENCY. THE SMALL BUSINESSMAN IS CAPABLE OF PERFORMING AND UNDERSTANDING RATIO ANALYSIS HIMSELF IF HE THINKS OF IT IN TERMS OF THE THREE BASIC STAGES OF SELECTION, INTERPRETATION, AND USE. IF THE SMALL BUSINESSMAN IS DISCRIMINATING DURING THE SELECTION STAGE, THE COMPLEXITY OF RATIO ANALYSIS IS GREATLY REDUCED IN THE TWO SUBSEQUENT STAGES BECAUSE ONLY THE RELEVANT RATIOS NEED BE CONSIDERED. THUS, THE KEY TO USE OF RATIO ANALYSIS SUCCESSFULLY, LIES IN CAREFUL SELECTION OF RATIOS BASED ON ONE'S SPECIFIC BUSINESS AND ANTICIPATED USES OF THE RATIOS. RATIO ANALYSIS MAY BE USED AS A PLANNING AID, FOR PREDICTION, AND FOR EVALUATION.
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Details
- Title
- RATIO-ANALYSIS FOR THE SMALL BUSINESSMAN
- Creators
- Herbert MayoBert Rosenbloom
- Publication Details
- Journal of small business management, Vol.13(1)
- Publisher
- Taylor & Francis Ltd
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- [Retired Faculty]
- Identifiers
- 991021862297304721