Explain what each ratio means and what the ratio tells you about your organization’s performance in the most recent period.

Finance week 2 assignment | Business & Finance homework help

The debt-to-equity ratio (D/E) measures the amount of debt a company has relative to its total assets. A higher D/E ratio indicates that more of the organization’s assets are financed through borrowing, while a lower ratio reflects less reliance on external financing. The current ratio is used to assess an entity\’s short-term liquidity by comparing its current liabilities to current assets – with higher ratios indicating greater ability pay obligations due within year .

Lastly, the return on equity (ROE) provides insight into how effective management has been when utilizing available resources generate profits; it is calculated as net income divided by shareholder’s equity thus resulting in percentage figure–with higher percentages being indicative better efficiency overall eventually . All these different ratios combine provide deeper understanding about health organization’s and allow for more informed decision making going forward eventually.