RATIO ANALYSIS THEORYRatio AnalysisRatio analysis is a widely used financial analysis. It is defined as the systematic use of a ratio so that financial statements can be interpreted to determine the strengths and weaknesses of a company as well as its historical performance and current financial position. Ratios reveal the relationship in a more meaningful way so that we can draw conclusions. The reason for ratio analysis is that it makes related information comparable. A single number by itself has no meaning, but when compared to a related number it gives rise to meaningful inferences. The ratio is very useful in understanding the message of the financial statement. It helps in broadening financial health, reveals the performance of a business and helps predict the future state of the business by studying historical data. Financial statements are the statements that provide information about the profitability and financial position of a company. It includes two statements, namely income statement a/c or income statement and balance....