1. Financial Statement Analysis

2. Two Primary Statements Balance Sheet –Snapshot –BV vs MV Income Statement –Period of time

3. Effects on Cash Flow Asset accounts Liability accounts Equity accounts

4. Ratio Analysis Five major categories –Liquidity –Long-term solvency –Asset management –Profitability –Market value

5. Ratio Analysis (cont) Liquidity –Current ratio (CR) –Quick ratio (QR) Important things to remember about these two ratios

6. Long-term Solvency Debt ratio Debt/equity ratio Times interest earned (TIE) Important things to remember about these ratios

7. Asset Management Total asset turnover (TATO) Inventory turnover Important things to remember about these two ratios

8. Profitability Return on equity (ROE) Return on assets (ROA) Profit margin (PM) Important things to remember about these ratios

9. Market Value Price to earnings ratio (P/E) Market to book ratio (M/B) Important things to remember about these ratios