1. Case on Microsoft Corporation
Using financial ratios allows us to compare two companies, such as the previous example, on an equal measuring tool and find out how they measure up to each other and the industry. Liquidity Ratios Microsoft current ratio is 52% above the industry average (FY 91: Microsoft 3.5 vs. industry 2.3). ... Microsoft's quick ratio is 94% above the industry average (FY 91: Microsoft 3.3 vs. industry 1.7). ... Microsoft's debt to asset ratio is 60% below the industry (FY 91: Microsoft .18 vs. industry .45). ... Microsoft is a very unique company. ...
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