Financial Analysis Case Study Example | Topics and Well Written Essays - 1250 words

Financial Analysis - fictional character Study ExampleIt is recommendable for Chris moth miller to use the past fiscal performance financial dimensions of Chang Dental Clinic as well as his financial forecasts to convince the bank to loan him the need funds to purchase the alveolar consonant practice. The past financial performance of Chang Dental Clinic will be useful to the bank in find out the financial performance and the capacity of the clinic to repay its debts which will then help it to determine whether to loan Miller or not.Miller should use the past financial performance of the clinic to convince the bank to loan him the required funds to purchase the practice. Liquidity ratios show the financial performance of the firm and also show the good for you(p) level of the firm. The reason as to why Miller should use the liquidity ratios for the clinic is because the loan will be repaid by the money that will be obtained from the clinic. The performance of the clinic will determine its ability to repay the loan once it is granted to Chris Miller who will be the proprietor and owner of the clinic. Some of the important financial ratios which Miller should present to the bank be as followsCurrent ratio and acid test ratio show the ability of a firm to pay for its short term liabilities. The short term assets of the clinic are able to pay for its short term liabilities since the financial ratio are more than 0.5. The debt ratio for the play along has reduced significantly from 2003 to 2005. Debt ratio compares the total debt of a company to its total assets. The low and reduced division for the clinic indicate less risk for the clinic and that the clinic is heavily dependent on leverage and that the clinic has a stronger equity position. increase net profit strand or positive trend in net profit margin for Chang Dental Clinic is an indication if increased profitability.Return on assets illustrates how a