what is
 






 

Question by  Bill11 (17)

What are accounting ratios?

 
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Answer by  Brandydog (631)

Accountants are interested in understanding a system of finicial losses and gains in much the same way an auto mechanic is interested in the system of an engine. The mechanic needs to know how much horsepower and torque the engine can generate. Similarly, accounting ratios are variables an accountant would use to evaulate diffrent elements of finance.

 
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Answer by  NobodysHome (385)

There are several kinds of accounting ratios, but essentially they are numbers in a ratio form designed to represent a financial concept such as profitability.

 
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