Compile the statements, ratio calculations and individual analysis from Status Report #$2$ into a cohesive report. Please ensure you work on the wording to ensure it sounds cohesive.

$2.$

Interpret the results of your horizontal, vertical and ratio analysis $($making reference to the relevant appendices$).$ Look for relationships among your different analyses. For example, you may notice that inventory has increased doing your horizontal and vertical analysis of the balance sheet. You might also note that the inventory turnover ratio has decreased while doing your ratio analysis. These two pieces of analyses are related! Tell me what happened, not that one calculation went up and one went down. I can see that.... Explain what happened? Did an event happen that year? What changes$/$strategies can you infer? Again, these are in your financial reports $($MD&A is very helpful here!$).$ Compare major ratios to industry norms or a competitor. This should be a separate section.

$4.$

Since you are aiming for a concise report, ensure that you highlight significant or dynamic ratios.

$5.$

Do NOT define each ratio. Your reader knows what they are.

$6.$

Calculate DOL, DFL and DCL for the most recent two years. If this is not possible, use your ratio analysis to determine the use of debt$/$equity financing and to evaluate the company$$s financing strategies. You must state if this is not possible and why. There are marks for calculating these ratios!

$7.$

Ensure that you have considered significant activity captured on the Statement of Cash Flows and the Statement of Changes in Shareholders$$ Equity.

$8.$

Analyze any further financial information you consider useful to evaluate performance $($for example, information based on individual business or geographic segments$).$

$9.$

Prepare and analyze appropriate graphs$/$charts using your spreadsheet program to support your analyses. Use excel to create some charts to demonstrate and better help explain your analyses. Vertical Analysis $-$ Statement of Earnings:

Common Size $(\%$ of Revenue$)$:

Year

$2022$

$2021$

$2020$

$2019$

Revenue

$100\mathrm{.}00\%$

$100\mathrm{.}00\%$

$100\mathrm{.}00\%$

$100\mathrm{.}00\%$

Operating Expenses

$84\mathrm{.}18\%$

$74\mathrm{.}88\%$

$102\mathrm{.}13\%$

$90\mathrm{.}18\%$

Operating Income

$9\mathrm{.}72\%$

$19\mathrm{.}00\%$

$-2\mathrm{.}09\%$

$9\mathrm{.}83\%$

Net Earnings

$5\mathrm{.}51\%$

$39\mathrm{.}99\%$

$12\mathrm{.}84\%$

$35\mathrm{.}28\%$

Vertical Analysis $-$ Statement of Financial Position:

Common Size $(\%$ of Total Assets$)$:

Year

$2022$

$2021$

$2020$

$2019$

Total Assets

$100\mathrm{.}00\%$

$100\mathrm{.}00\%$

$-$

$-$

Total Liabilities

$64\mathrm{.}64\%$

$59\mathrm{.}13\%$

$-$

$-$

Total Equity

$35\mathrm{.}36\%$

$40\mathrm{.}87\%$

$-$

$-$

Horizontal Analysis $-$ Statement of Earnings:

Year

$2022$

$2021$

$2020$

$2019$

Revenue

$+$$$6,238$m

$+$$$7,238$m

$+$$$6,984$m

$+$$$4,000$m

Operating Expenses

$+$$$8,865$m

$+$$$6,866$m

$+$$$7,130$m

$+$$$3,607$m

Operating Income

$-$$$2,627$m

$+$$$1,372$m

$-$$$146$m

$+$$$393$m

Net Earnings

$-$$$3,376$m

$+$$$2,898$m

$+$$$897$m

$+$$$1,411$m

Horizontal Analysis $-$ Statement of Financial Position:

Year

$2022$

$2021$

$2020$

$2019$

Total Assets

$+$$$19,352$m

$+$$$8,588$m

$-$

$-$

Total Liabilities

$+$$$10,714$m

$+$$$9,483$m

$-$

$-$

Total Equity

$-$$$4,520$m

$-$$$1,068$m

$-$

$-$

Solvency Ratios:

Debt$-$to$-$Equity Ratio: This ratio measures the proportion of debt financing relative to equity financing.

$2022$: $$20,301/$$$63,3980\mathrm{.}32$

$2021$: $$18,229/$$$64,3630\mathrm{.}28$

Interest Coverage Ratio: This ratio evaluates the company's ability to cover interest expenses with its operating income.

$2022$: $$4,542/$$$3,1791\mathrm{.}43$

$2021$: $$7,729/$$$2,6552\mathrm{.}91$

Debt Ratio: This ratio measures the proportion of assets financed by debt.

$2022$: $$20,301/$$$179,6080\mathrm{.}11$

$2021$: $$18,229/$$$168,8640\mathrm{.}11$

Profitability Ratios:

Net Profit Margin: This ratio measures the company's profitability by expressing net income as a percentage of total revenue.

$2022$: $$2,589/$$$53,309*100\%4\mathrm{.}86\%$

$2021$: $$5,816/$$$47,071*100\%12\mathrm{.}35\%$