Financial Management
HSM 220
Kaitlyn Calhoun
4/28/2011
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Importance of Financial Ratios
The splendour of each balance is to help owners or whoever is in instruction of running the agency to understand their companys mental process comp bed to their competitors and is also apply to track the business or agencys performance over time. Ratio analysis can show state many things about a company and its operations. Financial ratios argon basically viewing areas of strength or weakness when split and compared to each year. Contribution, general counseling and expense dropped from 2003 to 2004.
The program and meliorate in certain places but not very overmuch in others. The areas that would quest to be worked on improving are either trying to subject total expenses or spread the largest revenue source for the contribution ratio. The other thing that would need to be worked on would be trying to reduce management expenses or like for the contribution ratio, we would need to somehow reduce expenses.
By taking the revenue and expense ratio for example, this ratio compares how much the agency is spending (expense) to how much the agency is make (revenue). This will show them if they are making any considerate of profit or not. The program expense ratio is showing how much of the expenses are going toward the program.
2003
Current Ratio82,058.00/93,975.000.87
semipermanent Solvency359,863.00/259,979.001.38
Contribution632,889.00/1,244,261.000.51
Programs & depreciate865,691.00/1,316,681.000.66
General Management & Expense371,101.00/1,316,681.000.28
tax income & Expense1,244,261.00/1,316,681.00
0.94
2004
Current Ratio302,902.00/337,033.000.90
Long-Term Solvency699,004.00/338,937.002.06
Contribution1,078,837.00/2,191,243.000.49
Programs & Expense1,410,312.00/1,972,131.000.72
General Management & Expense445,819.00/1,972,131.000.23
Revenue & Expense2,191,243.00/1,972,131.00
1.11
2002
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