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View History Bookmarks People Window Help Cengage C Secure https//courses.aplia A company reports accouncing data ? its nnanoal statements. This data bs used for financial analyses that provide isates into a company's strengths, weainesses, performance in speciic areas, and trerds in performance. These analyses are often used to compare a company's performance to that of its compet tors, or to ies pest or expected futune performance. Suth insight helps managers and analysts improve their decision making Consider the fo lowing scenarie You work as an analyst at a credi-rating agency, and you ane comparing firms in the construction and engineering sector. One company in the portfolie of companies you are analyaing is a Chinese firm. This firm stands out in the ratio analysis, because the company's financial racios are substantia y lower than identical financial ratios of the other fires in the sector. You do not dissect the results of the ratio analysis and categorice report this firm as an under-performing company Which of the following statements about your analysis report is true? The ratios provide an accurate and thorough represe tatio of the Ores·companys-reman O The analysis likxely includes incorrect and misjeading condusions there are several groups of ratios most decision makers and analysts use to examne dnerent aspects of descriptions of ratios listed, identity the relevant category of ratios. company's performance. Based on the Ratios that help determine ,tether a company an access its cash and pay its ?0ee-oongations are aled * Ratios that help determine the efficiency with which a company manages its day-to-day tasks and assets are called Ratios that help assess a company's ability to service the interest and repayment obligations on its long-term debe and the degree to which it uses borrowed versus invested inancial capital are called ratios help measure a company's ability to generate income and profits based on its nvested capital ratios examine the market value of a company's share price, its profits and cash dividends, and the book value of the firm's assets and relate them to other data items to determine how the fem is perceived in the stock market 41 20

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