ACC 2310

Purpose: Analyze performance and interpret financial statements of Teslas company

Methodology: Select the financial statements (Balance Sheet and Income Statement) of Tesla's company. You will need the statements for three consecutive years for that company.

Identify the following characteristics about Tesla:

What industry does it operate in?

Financial trends in the industry

Who are some competitors?

Other important information? (if applicable)

Ratios to calculate and interpret for the three years.

Current Ratio

Quick (Acid Test) Ratio

Debt to Equity Ratio

Return on Equity

Return on Sales

Inventory Turnover

Return on assets

Asset utilization ratio

Final Report: You are taking the position of a Financial Analyst at a bank and you are preparing this report to make a recommendation on an application for a major loan. The loans officer at the bank would like you to summarize the performance of your company and make a recommendation to the bank.

Your report should include

Characteristics of Tesla's company as described above.

Copies of Financial statements of Tesla (all three years)

Calculations for all ratios of the company (all three years) as described above.

Interpretations of company ratios:

o What is the ratio measuring?

o Is the three-year trend positive/negative/neutral?

Recommendation to the loan officer. Grant the loan, why or why not? If yes could changes be made to strengthen the financial position further for a larger loan? If not, what are areas of improvement?

Grading Scheme

The following characteristics about Tesla: 10% (1-2 pages)

o What industry does it operate in?

o Financial trends in the industry

o Who are some possible competitors?

o Other important information? (If applicable)

Copies of Financial statements of your Company (all three years) 10% (2 pages)

Calculations for all ratios of company 25% (2-4 pages)

Interpretations of company ratios: 25% (2-4 pages)

o What is the ratio measuring?

o Is the three-year trend positive/negative/neutral?

Recommendation to the loan officer 10% (1 page)

Professional Report: 20%

o Well organized

o Word processed

o Professionally written and tone

o Addressed to Loan Officer

o Objective of report met