Question

2. What financial statements and the ratios associated with them are of particular importance to the creditors of the firm and why?

3. What measurements of both risk and return (the important concerns of management) can be found in the financial statements and what ratio's provide that information?

4, Does GAAP provide only one means to provide financial information to the readers of the financial statements or are there several that are allowed based on the financial status of the firm?

Answer 1

2-) In Order to ensure the firm has the ability to repay the eredit. The conditors may chak or Prefer francial Statements of the fams firm's dabucashout, Income statement and Cash flow statement. And also they will go through the following statement Ratios tike, they are quick Ratio , Current Ratio, Debt equity Rabio and. These Rahus are most important to present any prospective Creditors . 3-2 by Using financial Statement, a fom's financial Poschon and rate of return con be identifiable, while Using more clebt then equity will increase firms risk and at the same time it may increase rehin to measure a firme Risle and Return They may use some Rabios for getting be Picture Thery one, Tcs Scanne dabith equity Radio CamScanner

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