Chapter 15 covers Financial Statement Analysis. As you noted in the chapter, there are 3 common analytical techniques used to analyze a company's financial statements: 1) Horizontal Analysis 2) Vertical Analysis 3) Ratio Analysis Each technique can be used to assess the financial health and future prospects of a company. The ratios that can be used fall into three categories: 1) Liquidity Ratios - measure the short-term ability of the enterprise to pay its maturing obligations and to meet unexpected needs for cash. In your book - on page 693 - the liquidity ratios are from Working Capital down to and including Total Asset Turnover. 2) Profitability Ratios - measure the income or operating success of an enterprise for a given period of time. In your book - on page 693 - the profitability ratios are from Gross Margin Percentage down to and including Book Value per Share. 3) Solvency Ratios - measure the ability of the enterprise to survive over a long period of time. In your book - on page 693 - the solvency ratios are Times Interest Earned, Debt-to-Equity ratio and Equity Multiplier. In the text the authors state that an analyst should not rely solely on financial statement analysis when evaluating a company? Do you agree or disagree? Why?