The financial position of On Writing Teaching Notes Well Financial Analysis can be evaluated by taking a look at its ratio analysis.
We can see in appendix 1 how the income has actually been decreasing for many years after 2005. The truth that the gross earnings margin has actually reduced as well recommends that the expense of sales have not gone down at the same speed. The decreasing net success, revealing a negative trend from 2006 to 2007 recommends that expenditures have increased even more than the company is able to manage given its present resources. With a long term financial obligation adding to the interest expense, On Writing Teaching Notes Well Financial Analysis is in alarming requirement of an alternative income stream.
Decreasing Liquidity: We can see a significant decreasing trend in the current ratio too revealing a fall in liquidity which is another point of issue for On Writing Teaching Notes Well Financial Analysis especially as it has a long term debt to pay off. With the current assets not in a position to settle the existing liabilities, we can see how the business would be in a significant financial problem unless the capital enhances with extra sources of financing.
Rising Debt to Possessions Ratio: We might explore the monetary condition of On Writing Teaching Notes Well Financial Analysis even more by looking at the business's overall financial obligation to total properties ratio in appendix 2. Such a situation has brought On Writing Teaching Notes Well Financial Analysis to a point where its overall debt to overall possessions ratio has increased. A rising total debt to overall properties ratio suggests that the danger has increased in terms of the business's possessions not being enough to cover its total liabilities.