Question

Give one word/term/ phrase for each of the following statements :

A particular mathematical number showing relationship between two accounting figures.

Answer 1

Accounting Ratio

Explanation: Accounting ratio expresses the relationship between two accounting variables. It is one amongst the various tools available for financial analysis. Financial ratios are calculated from the financial statements to derive conclusions regarding liquidity, profitability and solvency of a business. They are used to measure the efficiency and profitability of a company based on the financial reports prepared by the business. They facilitate the decision-making task of the management.