Financial Performance Use The Internet To Research An Annual

GM Financial RatiosName:Institutional affiliationGM Financial RatiosAs a potential creditor of the General motors, I must understand the financial ratios of the company in order to measure the risk of financing the company. Financial ratios indicate the financial health of the company at a glance. The liquidity ratios of the company provide information that will enable a lender to quickly understand the position of the company to meet its current obligations. The three important liquidity ratios that are important to me as a lender are the current ratio, quick ratio and cash ratio(Troy, 2008, p.46).Profitability ratios unlike liquidity ratios measures the performance of the company by its ability to make profits. Profits are usually the difference between the incomes and the expenses. The most important ratios are the gross margin and the operating margin (Troy, 2008, p.105).The current ratio demonstrates the extent to which current assets are available to meet the current liabilities. A higher current ratio indicates that the company is in a better position to meet its obligations. For the year ended on 31 December 2014, the current ratio for GM was 127%, down from 131% the