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    pnana's Avatar
    pnana Posts: 1, Reputation: 1
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    #1

    Nov 1, 2010, 12:41 PM
    How does one analyse balance sheet
    Just Looking's Avatar
    Just Looking Posts: 1,610, Reputation: 480
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    #2

    Nov 5, 2010, 11:42 AM

    To analyze a balance sheet, you look at a few simple calculations including the Current Ratio, Quick Ratio, Working Capital, and Debt to Equity Ratio. You can find these calculations in your text book or online, but ask if you need help understanding them. There are industry standards for each that you can compare to the company in question to determine how strong it is. Since a Balance Sheet is a picture of the company’s health at one point in time, it is also helpful to look at more than one period. This will also show the direction the company is headed.

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