Investors should utilize the quantity of data provided in a company's financial statements to help

them evaluate the company as a potential investment. In terms of total profitability, the net

income appears to be the obvious beginning point when evaluating a financial statement. This

bottom-line dollar figure on a corporation's income statement is a useful indicator of profitability

because it measures the money a company generates after all production costs, depreciation, tax,

interest, and other expenses have been deducted. However, net income should not be the sole

aspect to consider when evaluating a company.

The following are the most often used and top three financial ratios:

 The debt-to-equity ratio is a calculation that determines a company's financial leverage

by dividing total liabilities by stockholders' equity. The percentage of equity and debt

utilized by the firm to fund its assets is represented by this ratio.

 The current ratio is a liquidity ratio that determines a company's capacity to repay short-

term commitments. This ratio is often referred to as a cash asset ratio, a cash ratio, or a

liquidity ratio. A greater current ratio suggests that a firm is better able to repay its

obligations.

 The quick ratio, often known as the "acid test ratio" or "quick assets ratio," is a measure

of a company's short-term liquidity. The quick ratio is a useful tool for comparing a

company's most liquid assets to its short-term obligations (Wilkins, 2021).

I would recommend client to invest in Blue-chip stock.

 Debt-to-equity ratio: 0.95

 Current Ratio: 0.02

 Quick Ratio: 0.02

References

MoneyControl. (N.D.). Bluechip Stockspin Ltd. Retrieved from:

https://www.moneycontrol.com/financials/bluechip%20stocks/ratiosVI/BSL01

Wilkins, G. (2021). 6 Basic Financial Ratios and What They Reveal. Retrieved from:

https://www.investopedia.com/f inancial-edge/0910/6-basic-financial-ratios-and-what-they-tell-

you.aspx