- How can Accountants use the information on the balance sheet for decision making?
- What can the balance sheet tell us about the progress of the business?
- Check your readings for these formulas
- Working Capital
- The Current Ratio
- Debt to Equity Ratio
Activity: Using the balance sheets prepared from the previous lesson analyze these businesses using the above tools
Questions you will be able to answer:
- Which business would you lend money to? Support your answer using thee above calculations
- Which business do you think has the most opportunity for future expansion?
- Why is the current ratio a better way to compare companies?