- How to Read a Financial Statement
In sports, the statistics sheet shows who won and lost, as well as how or why each team won or lost. These numbers also tell coaches and players what they’re doing right and what they need to work on. In the world of business, that stat sheet is known as the financial statement – or simply the financials.The financials tell the owner or manager the same thing: what you’re doing right, what you need to work on and how your stats compare to your competitors. This video covers the basics of reading and understanding a financial statement.
- Ratio Analysis
You cant build a house without the right measuring tools to ensure that the structure is sound and wont collapse: tape measures, protractors and levels are used to tell construction workers and architects how much material is needed and where everything goes.In the business world, the measuring tools are called financial ratios, and they help you evaluate a financial statement. By learning how to calculate and analyze specific ratios, you can evaluate trends, determine how healthy a business is, and have key indicators as to how the business is performing.They also allow you to make financial comparisons between companies. This video covers the ratios most commonly used to analyze a business.