Written By: Carol G. Prather
Application of the ratio analysis technique to personal financial statements offers potential in expanding insight into specific strengths and weaknesses of a family?s financial situation. Norms for 16 ratios, based on data from the 1983 Survey of Consumer Finances (SCF), are presented with indications of how each ratio might be used to assess liquidity, solvency, or the general financial position of a particular family. The norms may be used as a basis for comparison in assessing specific components of a client?s net worth. Key Words: net worth, ratios
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