Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Calculate the following ratios for Walmart and a competitor for two years. Present your calculations in a table. Liquidity ratios: 1. Working Capital = Current

image text in transcribed
Calculate the following ratios for Walmart and a competitor for two years. Present your calculations in a table. Liquidity ratios: 1. Working Capital = Current Assets - Current Liabilities 2. Current Ratio = Current Assets + Current Liabilities 3. Inventory Turnover Ratio = Cost of Goods Sold - Average Inventory Solvency ratios: 1. Debt-to-Equity Ratio = Total Liabilities - Stockholders' Equity Profitability ratios: 1. Net Margin (Profit Margin) Ratio = Net Income + Net Sales 2. Gross Profit Ratio = Gross Profit = Net Sales 3. Asset Turnover Ratio = Net Sales - Average Total Assets 4. Return on Equity = Net Income = Average Total Stockholders' Equity Stock market ratios: 1. Earnings per Share = Net Earnings + Average number of outstanding common shares 2. Price/Earnings (P/E) Ratio = Market Price Per Share = Earnings Per Share Your ratio analysis should include one or two paragraphs discussing the performance of Walmart vs. the competitor as shown by the 10 ratios; discuss trends and meanings. Summarize your analysis of the firm and comment as to whether or not it is a company in which you would invest. Why or why not? The summary and recommendations should be a minimum of three paragraphs detailing your overall evaluation of Walmart. Calculate the following ratios for Walmart and a competitor for two years. Present your calculations in a table. Liquidity ratios: 1. Working Capital = Current Assets - Current Liabilities 2. Current Ratio = Current Assets + Current Liabilities 3. Inventory Turnover Ratio = Cost of Goods Sold - Average Inventory Solvency ratios: 1. Debt-to-Equity Ratio = Total Liabilities - Stockholders' Equity Profitability ratios: 1. Net Margin (Profit Margin) Ratio = Net Income + Net Sales 2. Gross Profit Ratio = Gross Profit = Net Sales 3. Asset Turnover Ratio = Net Sales - Average Total Assets 4. Return on Equity = Net Income = Average Total Stockholders' Equity Stock market ratios: 1. Earnings per Share = Net Earnings + Average number of outstanding common shares 2. Price/Earnings (P/E) Ratio = Market Price Per Share = Earnings Per Share Your ratio analysis should include one or two paragraphs discussing the performance of Walmart vs. the competitor as shown by the 10 ratios; discuss trends and meanings. Summarize your analysis of the firm and comment as to whether or not it is a company in which you would invest. Why or why not? The summary and recommendations should be a minimum of three paragraphs detailing your overall evaluation of Walmart

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Trucking Industry IRS Audit Techniques Guide

Authors: Internal Revenue Service

1st Edition

1304135640, 978-1304135643

More Books

Students also viewed these Accounting questions

Question

The company openly shares plans and information with employees.

Answered: 1 week ago