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This module you are using financial analysis tools to evaluate the financial health of companies. One tool you are learning about is financial ratios and you can use this summary of financial ratios as a guide. You will be combining your findings from this discussion response into your final course project paper in Module 5. There are three categories of financial ratios: liquidity, solvency, and profitability.
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• Describe what each category tells the user about the financial health of a company.
• Choose three ratios in each category and describe what the ratios tell the user about the company. How are financial ratios used to evaluate a company? • Discuss what the numbers would be compared against for analysis. • Calculate each ratio for your companies. What do the ratios tell you about each of your companies?