Looking at the outstanding shares of both companies, Apple has more common shares outstanding on the open market than Microsoft. We can assume that Apple increases the issuance of outstanding shares to reduce the stock price, thus making Apple stock affordable (Miller-Nobles, Mattison, and Matsumura 669). Finally, Apple shares are selling at 15,230.83 times one-year earnings compared to Microsoft's sales at 38.82 times. This ratio tells investors how much they are willing to pay for each dollar of a company's earnings. As a result, Apple has a higher ratio, which means a higher price-to-earnings ratio, a higher return on investment (Miller-Nobles, Mattison, and Matsumura 670). Overall, horizontal analysis and financial ratios are essential factors that companies use to monitor their liquidity. Therefore, in order to improve Apple's ratios and profitability, the company must implement a strategy to increase the company's liquidity. Business owners or managers should monitor the current ratio and acid test ratio as these ratios help us ensure that the company has adequate liquidity to pay current liabilities, stay in business and expand the company. As we noted in our acid test ratio and current ratio for the company, we show a ratio for the acid test ratio lower than the current ratio, which means that the company's current activities are dependent on inventory. Therefore, the company must convert the old inventory into