Ratio Analyzes of Marks & Spencer Company Research Paper

Ratio Analyzes of mark & Spencer Company - Research Paper ExampleAnd secondly it enables the organization to understand which products or assets of the accompany be producing more revenues for the company, how efficiently these are being utilized and which products or assets are not profitable and should be replaced or eliminated.From the reporting perspective, accounting provides the bookkeeping of day-to-day activities and every transaction that is taking place. This essential government agency of reporting enables the company to appreciate itself and avoid any frauds or misinterpretations.Form the decision making perspective, the decisions to evaluate the growth opportunities for the organization, for analyzing the performance of the company, for analyzing the companys ability to pay its suppliers and shareholders etc. a number of operational and strategic decisions same(p) budgeting and investigating are made though accounting.Ratio Analysis is basically analyzing the relat ionship between various sections of the various financial statements and this analysis is based on a comparison. Ratio analysis can be of two kinds Comparative Analysis in which the ratios are compared with the industry average ratios and Trend Analysis in which the ratios of the same company are compared on a periodic basis i.e. a course of study is compared with the anterior year.The profitability ratios show that overall the company is in lettuce and will achieve more profits in rising. This is because the profit on sales is mettlesomeer than the previous year and also the return that the company is getting on its assets has been increasing. Although the return on equity has been decreased which makes the shareholders to resist from investing in future but the shareholders are still expected to invest because the return they are getting is still high and not very low considerably. 3.2. Liquidity flow rate Ratio Current Ratio = Current Assets/ Current LiabilitiesFor year 20 06= 1142.1/ 2017= 56.62%For year 2007= 846.4/ 1606.2= 52.69%Quick RatioQuick Ratio = Current Assets - Inventories / Total Current LiabilitiesFor year 2006 = 1142.1- 374.3/ 2017 = 38.06%For year 2007 = 846.4 - 416.3/ 1606.2 = 26.77%The liquidity ratios portray that the companys liquidity has been decreased over time and less cash on hand is present. This portrays that the company is investing more and is therefore low on liquidity. But these