Altempts

$$

averinge $12$

$10.$ Analyzing ratios

One of the most important applications of ratio analysis is to compare a company's performance with that of other players in the industry or to compare its own performance over a period of time. Such analyses are referred to as a comparative analysis and trend analysis, respectively.

A common sire analysis requires the representation of financial statement data relative to a single financial statement item $($or base account or value$).$ What is the most commonly used base item for a common size balance sheet?

Net sales

Earnings before interest and taxes

Total assets

Net income

Suppose you are conducting an analysis of the financial performance of Cute Camel Woodcraft Company over the past three years.

The company did not issue new shares during these three years and has faced some operational difficulties. The company has thus pilot tested some new forecasting strategies for better operations management. You have collected the company's relevant financial data, made reasonable assumptions based on the information available, and calculated the following ratios.

Ratios Calculated