Contents

• Executive Summary 1
• Introduction 3
• American Airlines Group 3
• United Airlines Inc. 3
• Financial Statement Analysis 4
• Different types of Ratio and its importance 5
• Profitability Ratio 6
• Gross Profit Margin 6
• Net profit margin 6
• Liquidity Ratio 7
• Current Ratio 7
• Quick Ratio 8
• Turnover Ratio 9
• Debtors Turnover Ratio 9
• Asset Turnover Ratio 10
• Return on Investment (ROI) Ratio 11
• Return on Assets Ratio – ROA 11
• Return on equity (ROE) 11
• Gearing Ratio 12
• Debt Equity Ratio (Capital gearing ratio) 12
• Conclusion 13
• References 14

Description

Ratio analysis is one of the popular traditional way to interpret financial statement of an organisation. It also works a tool for comparing financial status of different organisation. When it’s about financial statement analysis, Ratio Analysis works as one of the best weapon for interpreting all data and numbers which are in financial statements like the data of profit and loss, balance sheet, expenses in an organized and better manner. Ratio are used for analyzing a business from various points of views. Financial statement of two big conglomerates American airlines groups and United airline lnc. are analyzed for in depth comparative study for understanding its financial position. The report describes the study done on financial ratio for understanding the better view of a business.