Question: Know how to interpret key financial ratios (pgs. 163 - 165 as well as the handout provided.) You DO NOT need to memorize financial ratio

Know how to interpret key financial ratios (pgs. 163 - 165 as well as the handout provided.) You DO NOT need to memorize financial ratio formulas; however, you must know how to interpret these ratios. What do they mean? What do they say about a company's financial position strength? Also know other ratios that provide auditors with a more complete picture of the client's financial position (e.g., AR as % of sales, allowance as % of AR. or Sales, inventory as % of current assets, etc.)

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