ABSTRACT

This research entitled "An analysis on the uses of accounting ratio in business decision making" tried to find out the degree to which accounting ratios can be used to draw conclusions upon which decisions 'are made. This has been done considering Guarantee Trust Bank PLC as a case study. The researcher specifically and to identify different ratios used in financial statement analysis in decision making. Also, the role of financial ratios analysis in decision making had to be indicated, and lastly the uses and limitation of accounting ratios. Both secondary and primary data were consulted during this research. Primary data was collected with the help of interviews given to the members of the management staff. Respondents were selected based on their role in financial activities in guarantee Trust Bank PLC. Under secondary data, financial statements of Guarantee Trust 8ank PLC, textbooks and internet resources were consulted. The chi-square was used to analyze the hypothesis of whether the use of accounting ratio does not significantly guide management as an effective tool in decision making with five percent level of significance, and to determine whether the use of curveting ratios in financial statements analysis varies according to the decision to be made by those who use them. Also, orre1ation and regression techniques were used in analyzer the data. Different managers use different analytical tools and techniques depending on the objectives of the analys4 and nature of the business..