Performing Financial Ratio Analyses Enables a Business Owner to Identify

question 48

True/False

Performing financial ratio analyses enables a business owner to identify problems early-before they become crises.

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Definitions:

Work-in-progress

Inventory that includes materials that have been partially processed but are not yet finished goods in the manufacturing process.

Finished Good

A product that has completed the manufacturing process and is ready for sale to customers.

Raw Material

Basic materials extracted from the environment or produced through agriculture that are used in the manufacture of goods.

Character

A qualitative assessment of a borrower's moral and ethical qualities and the likelihood that they will repay a loan.