ABSTRACT
The chapter discusses uses of financial information and how viewpoints toward financial analysis change, depending on the purpose of the evaluation. Calculations of major financial ratios used to analyze financial condition and performance are discussed and illustrated using an example case, along with benchmarks. Also, included in the discussion is the interpretation of various ratios, as well as limitations of financial ratio analysis. Finally, the chapter ends with a discussion and illustration of the profitability analysis system and how the system can be used to improve decision-making.
