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Ratios provide the users of financial statements with a great deal of information about the entity. Do ratios tell the whole story? How could liquidity ratios be used by investors to determine whether or not to invest in a company?
Let at least two of your peers know how debt service ratios can be used by a lender in determining whether or not to lend money to a company.
- Profit Margin
Year Ending December 2012
Year Ending December 2011
Year Ending December 2010
Maintenance and Repairs
Total Operating Expenses
Sales and Administrative Expenses
Above is a comparative income statement for Cecil, Inc. for the years 2010, 2011, and 2012. Calculate the profit margin for each of these years. Comment on the profit margin trend.
Let at least two of your peers posts know what you changes you would recommend to improve the net margin of the company.