Ratio analysis

Introduction To find out the better solution to buy the bookshop, Fancy Folios Pty Ltd or the coffee shop, Cup Hand Pty Ltd, we make a considerate selection by the whole process: gathering the right information, analyzing the ratios extensively, evaluating the alternatives and finally we determine to invest in Fancy Folios Pty Ltd. Now we would like to reveal the particular process in two steps. Firstly, we analyze the present and likely future positions …

…limitations for the ratios analysis: 1)<Tab/>It cannot reflect the whole assets efficiency and management level. It cannot determine the operation result according to the ratio analysis. It is only one of the methods to reach the target and maximum the profits. 2)<Tab/>The industry averages is hard to measure the real performance in finance situation because the enterprise is in different standard with different growing period.