RELEVANCE OF FINANCIAL RATIO ANALYSIS IN THE APPRAISAL OF SMALL SCALE BUSINESS (A CASE STUDY OF SOME SELECTED SMALL SCALE BUSINESS IN BAYELSA STATE)

This research work examined the relevance of financial ratio analysis in the appraisal of small scale business with particular reference to small business in Bayelsa State. The study examined the establishing of the extent to which accounting ratios can be used to interpret accounting records of small scale business. The data was collected from both primary and secondary sources of data and were based on reading from textbook, internet and journals. Data from the responses to questionnaire were analyzed using chi-square statistics. From the analysis, the findings showed that nonchalant attitude in the use of financial statement affects small scale business. It was however recommended that the retained earnings of the small scale business should be properly invested in order to have more capital for business.