Question.4332 - Ch. 6 Written Assignment 2 (Video Activity)DetailsWatch the video "Ratio Analysis¢ € ”Limitations of Ratios" [6 mins 7sec] and answer the following two questions:(Source: tutor2u. (2016, May 26). Ratio Analysis - Limitations of ratios [Video]. YouTube. https://www.youtube.com/watch?v=UuahUYKvV1k)In the video, Jim walks through several key limitations in the areas of reliability, comparability, relying on only one data source, and using information based in the past. Which limitation do you feel is the most worrisome? What might you do to compensate for the limitation you identified?Outside of the four key areas of limitations, Jim also explores a number of key elements that ratios aren't able to convey. What characteristics of a firm would you most want to know about if you were to invest that you would not be able to glean from ratios? How would you go about gathering that information if you cannot get it through financial statements and ratio analysis?
Answer Below:
In xxx video xxx walks xxxxxxx several xxx limitations xx the xxxxx of xxxxxxxxxxx comparability xxxxxxx on xxxx one xxxx source xxx using xxxxxxxxxxx based xx the xxxx Which xxxxxxxxxx do xxx feel xx the xxxx worrisome xxxx might xxx do xx compensate xxx the xxxxxxxxxx you xxxxxxxxxx In xx opinion xxx of xxx most xxxxxxxxx limitations xx financial xxxxx analysis xx its xxxxxxxxxx on xxxxxxxxxx data xxxx data xxxxxx predict xxx future xxxxxxxxxxx of x company xx compensate xxx this xxxxxxxx it xxxxxxxxx other xxxxxxx we xxxxxx look xxx industry xxxxxx economic xxxxxxxxx and xxx company's xxxxxx plans xx get x more xxxxxxxxxxxxx picture xx can xxxx analyze xxxxxx in xxx ratios xxxx several xxxxx to xxx if xxxxxxx a xxxxxxxxxx improvement xx decline xxxxxxx of xxx four xxx areas xx limitations xxx also xxxxxxxx a xxxxxx of xxx elements xxxx ratios xxxxxx able xx convey xxxx characteristics xx a xxxx would xxx most xxxx to xxxx about xx you xxxx to xxxxxx that xxx would xxx be xxxx to xxxxx from xxxxxx How xxxxx you xx about xxxxxxxxx that xxxxxxxxxxx if xxx cannot xxx it xxxxxxx financial xxxxxxxxxx and xxxxx analysis xxxxxxxx ratios xx not xxxxxx a xxxxxxxxx competitive xxxx or xxxxxxx practices xxxxxxxx investors xxx gain xxxx information xxxx the xxxxxxxxx sources xxxxxxxx reports xxx analyst xxxxxxxx Research xxxxx and xxxxxxxx analysts xxxxx assess x company's xxxxxxxxxxx advantage xxxxx on xxxxxxx like xxxxxx share xxxxx strength xxx product xxxxxxxxxxxxxxx These xxxxxxx might xxxx touch xx the xxxxxxxxx environmental xxxxxx and xxxxxxxxxx ESG xxxxxxxxx providing xxxxxxxx into xxx ethical xxxxxxxxxx Company xxxx and xxxxx releases xxxxxxxx can xxxx for xxxxxxxxxxxxx about xxx product xxxxxxxx market xxxxxxxxxx or xxxxxxxxx partnerships xxxxx can xxxxxxxx a xxxxxx competitive xxxxxxxx Press xxxxxxxx related xx awards xx recognition xxx ethical xxxxxxxxx can xxxx be x positive xxxx Industry xxxxxxxxxxx and xxxxxxxxxxxxx Attending xxxxxxxx events xx listening xx company xxxxxxxxxxxxx can xxxxxxx valuable xxxxxxxx into xxxxxxxxxxxx vision xxxxxxxx and xxxxxxxx to xxxxxxxxxxx and xxxxxxx considerations xxxxxxxx reviews xxx news xxxxxxxx Reviews xx consumer xxxxxxxxx and xxxxxxxx from xxxxxxxxx sources xxx reveal xxxxxxxx sentiment xxxxxxx a xxxxxxxxx products xxxxxxxx and xxxxxxxx practices xxxxxxxx ModulePreviousNext xxxxxxxxxxMore Articles From Finance
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