Accounting Principle

Budget is a blueprint for the future course of action and activities. It means expressing the future course of action of an organization in quantitative…

Activity ratios indicate the performance of the business. The performance of a business is judged by its sales (turnover) or cost of goods sold. These…

Profitability Ratios The efficiency of a business is measured by profitability. Profitability ratio measures the profit earning capacity of the business concern. A profitability ratio…

Solvency Ratios Solvency refers to the firms’ ability to meet its long-term indebtedness. It studies the firms’ ability to meet its long-term obligations. Moreover, the…

Liquidity Ratios In accounting, the term liquidity is defined as the ability of a company to meet its financial obligations as they come due. Liquidity…

Advantages of Ratio Analysis: Ratio is an expression of one number in relation to another. Ratio analysis is the procedure of formative and interpreting the…

Expression of Ratios: Ratio is an expression of one number in relation to another. Ratio analysis is the procedure of formative and interpreting the mathematical…

Ratio Analysis Ratio is an expression of one number in relation to another. Ratio analysis is the procedure of formative and interpreting the mathematical relationship…

Limitations of Financial Statement Analysis Financial statements are final result of accounting work done during the accounting period. Financial statements normally include Trading, Profit and…

Significance of Financial Statement Analysis: Financial statements are final result of accounting work done during the accounting period. Financial statements normally include Trading, Profit and…