Define: Ratio Analysis

Business, Legal & Accounting Glossary

Definition: Ratio Analysis


Full Definition of Ratio Analysis

Ratio Analysis is a tool used by individuals to conduct a quantitative analysis of information in a company’s financial statements.

Application of Ratio Analysis

Ratios are calculated from current year numbers and are then compared to previous years, other companies, the industry, or even the economy to judge the performance of the company.  Ratio analysis is predominately used by proponents of fundamental analysis.


Cite Term

To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
Modern Language Association (MLA):
Ratio Analysis. Payroll & Accounting Heaven Ltd. April 07, 2020
Chicago Manual of Style (CMS):
Ratio Analysis. Payroll & Accounting Heaven Ltd. (accessed: April 07, 2020).
American Psychological Association (APA):
Ratio Analysis. Retrieved April 07, 2020, from website:

Definition Sources

Definitions for Ratio Analysis are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 22nd March, 2020