Examine the four primary financial statements for each firm and address the following:

• Statement of Cash Flows:
  • Compare the statement of cash flows for the two firms, noting the major inflows and outflows of cash.
• Income Statement:
  • Compare the income statements for the two firms, noting the issues each one faces regarding sales projections.
• Balance Sheet:
  • Compare the balance sheets for the two firms, noting any issues each firm may want to address regarding liability, and how each firm might be impacted by increasing interest rates.
• Shareholder Equity:
  • Calculate the shareholder equity for each firm.
• Calculate the following ratios and trend analyses on each company:
  • ROI analysis
  • Ratio analysis, to include the following ratios:
    • Profit Margin
    • Return on Assets
    • Return on equity
    • Receivable Turnover
    • Average Collection period
    • Inventory turnover
    • Current ratio
    • Working Capital
    • Debt to total assets
    • Debt to equity
    • Earnings per share
    • Price to Earnings ratio
  • Horizontal, vertical, and trend analysis of financial statements

For Caterpillar, see data below: Sales and Revenues by Segment (Millions of dollars) First Quarter 2019 Sales Volume Price Realization Currency InterSegment / Other First Quarter 2020 $ Change % Change Construction Industries ................................ $ 5,873 $ (1,418) $ (63) $ (59) $ (27) $ 4,306 $ (1,567) (27%) Resource Industries ..................................... 2,752 (607) (21) (40) 2,084 (668) (24%) Energy & Transportation .............................. 5,210 (599) 21 (37) (246) 4,349 (861) (17%) All Other Segment........................................ 121 (9) (3) 109 (12) (10%) Corporate Items and Eliminations ................ (1,232) 22 1 (1) 276 (934) 298 Machinery, Energy & Transportation........ 12,724 (2,611) (62) (137) 9,914 (2,810) (22%) Financial Products Segment ........................ 850 (36) 814 (36) (4%) Corporate Items and Eliminations ................ (108) 15 (93) 15 Financial Products Revenues ................... 742 (21) 721 (21) (3%) Consolidated Sales and Revenues........... $ 13,466 $ (2,611) $ (62) $ (137) $ (21) $ 10,635 $ (2,831) (21%) Caterpillar Inc. Condensed Consolidated Statement of Results of Operations (Unaudited) (Dollars in millions except per share data) Three Months Ended March 31, 2020 2019 Sales and revenues: Sales of Machinery, Energy & Transportation $ 9,914 $ 12,724 Revenues of Financial Products 721 742 Total sales and revenues 10,635 13,466 Operating costs: Cost of goods sold 7,266 9,003 Selling, general and administrative expenses.1,121 1,319 Research and development expenses. 356 435 Interest expense of Financial Products.175 190 Other operating (income) expenses.... 313 312 Total operating costs ..... 9,231 11,259 Operating profit....1,404 2,207 Interest expense excluding Financial Products....113 103 Other income (expense) . 222 160 Consolidated profit before taxes. 1,513 2,264 Provision (benefit) for income taxes. 425 387 Profit of consolidated companies .......1,088 1,877 Equity in profit (loss) of unconsolidated affiliated companies..5 7 Profit of consolidated and affiliated companies 1,093 1,884 Less: Profit (loss) attributable to noncontrolling interests ........................................................................................................ 1 3 Profit 1 .... $ 1,092 $ 1,881 Profit per common share .... $ 2.00 $ 3.29 Profit per common share diluted 2 ...$ 1.98 $ 3.25 Weighted-average common shares outstanding (millions) Basic.. 546.8 572.4 Diluted 2 ....551.1 578.8 Caterpillar Inc. Condensed Consolidated Statement of Financial Position (Unaudited) (Millions of dollars) March 31, 2020 December 31, 2019 Assets Current assets: Cash and short-term investments... $ 7,123 $ 8,284 Receivables trade and other 7,834 8,568 Receivables finance.....9,120 9,336 Prepaid expenses and other current assets ...1,761 1,739 Inventories ...11,748 11,266 Total current assets....37,586 39,193 Property, plant and equipment net .... 12,488 12,904 Long-term receivables trade and other.... 1,196 1,193 Long-term receivables finance....12,021 12,651 Noncurrent deferred and refundable income taxes............................................................ 1,426 1,411 Intangible assets ..1,478 1,565 Goodwill . 6,140 6,196 Other assets... 3,559 3,340 Total assets .... $ 75,894 $ 78,453 Liabilities Current liabilities: Short-term borrowings: -- Machinery, Energy & Transportation ...$ $ 5 -- Financial Products...4,789 5,161 Accounts payable .. 5,769 5,957 Accrued expenses .... 3,776 3,750 Accrued wages, salaries and employee benefits..... 878 1,629 Customer advances.....1,295 1,187 Dividends payable . 567 Other current liabilities.... 2,074 2,155 Long-term debt due within one year: -- Machinery, Energy & Transportation . 143 16 -- Financial Products............................................................................................. 7,792 6,194 Total current liabilities......................................................................................................... 26,516 26,621 Long-term debt due after one year: -- Machinery, Energy & Transportation .. 8,998 9,141 -- Financial Products... 15,371 17,140 Liability for postemployment benefits.........6,333 6,599 Other liabilities . 4,437 4,323 Total liabilities .... 61,655 63,824 Shareholders equity Common stock . 6,046 5,935 Treasury stock.................................................................................................................... (25,341) (24,217) Profit employed in the business ......................................................................................... 35,504 34,437 Accumulated other comprehensive income (loss) ............................................................. (2,012) (1,567) Noncontrolling interests ..................................................................................................... 42 41 Total shareholders equity....................................................................................................... 14,239 14,629 Total liabilities and shareholders equity............................................................................... $ 75,894 $ 78,453 Condensed Consolidated Statement of Cash Flow (Unaudited) (Millions of dollars) Three Months Ended March 31, 2020 2019 Cash flow from operating activities: Profit of consolidated and affiliated companies........................................................................................................ $ 1,093 $ 1,884 Adjustments for non-cash items: Depreciation and amortization ........................................................................................................................ 614 641 Gain on remeasurement of a non-U.S. pension obligation ............................................................................. (254) Provision (benefit) for deferred income taxes ................................................................................................. 20 (11) Other ............................................................................................................................................................... 534 88 Changes in assets and liabilities, net of acquisitions and divestitures: Receivables trade and other ........................................................................................................................ 500 (150) Inventories....................................................................................................................................................... (541) (813) Accounts payable............................................................................................................................................ 90 355 Accrued expenses........................................................................................................................................... (97) 135 Accrued wages, salaries and employee benefits ............................................................................................ (722) (1,185) Customer advances ........................................................................................................................................ 116 105 Other assets net........................................................................................................................................... (50) (7) Other liabilities net........................................................................................................................................ (173) 79 Net cash provided by (used for) operating activities...................................................................................................... 1,130 1,121 Cash flow from investing activities: Capital expenditures excluding equipment leased to others (305) (278) Expenditures for equipment leased to other (243) (269) Proceeds from disposals of leased assets and property, plant and equipment . 216 209 Additions to finance receivables ..(2,953) (2,615) Collections of finance receivables . 3,153 2,818 Proceeds from sale of finance receivables 31 44 Investments and acquisitions (net of cash acquired). (35) (2) Proceeds from sale of securities.. 68 57 Investments in securities .(180) (107) Other net..35 (38) Net cash provided by (used for) investing activities....(213) (181) Cash flow from financing activities: Dividends paid .(567) (494) Common stock issued, including treasury shares reissued. (23) (5) Common shares repurchased . (1,043) (751) Proceeds from debt issued (original maturities greater than three months) .. 2,141 2,665 Payments on debt (original maturities greater than three months).. (2,466) (2,567) Short-term borrowings net (original maturities three months or less) .. (40) (522) Other net (1) (1) Net cash provided by (used for) financing activities ..(1,999) (1,675) Effect of exchange rate changes on cash..(80) 3 Increase (decrease) in cash and short-term investments and restricted cash . (1,162) (732) Cash and short-term investments and restricted cash at beginning of period..8,292 7,890 Cash and short-term investments and restricted cash at end of period ..$ 7,130 $ 7,158 Supplemental Data for Results of Operations For the Three Months Ended March 31, 2020 (Unaudited) (Millions of dollars) Supplemental Consolidating Data Consolidated Machinery, Energy & Transportation 1 Financial Products Consolidating Adjustments Sales and revenues: Sales of Machinery, Energy & Transportation ............. $ 9,914 $ 9,914 $ $ Revenues of Financial Products.721 830 (109) 2 Total sales and revenues ..10,635 9,914 830 (109) Operating costs: Cost of goods sold ...................................................... 7,266 7,267 (1) 3 Selling, general and administrative expenses............. 1,121 940 182 (1) 3 Research and development expenses........................ 356 356 Interest expense of Financial Products ....................... 175 176 (1) 4 Other operating (income) expenses............................ 313 10 320 (17) 3 Total operating costs ................................................... 9,231 8,573 678 (20) Operating profit.................................................................. 1,404 1,341 152 (89) Interest expense excluding Financial Products........... 113 112 1 4 Other income (expense)... 222 179 (47) 90 5 Consolidated profit before taxes...................................... 1,513 1,408 105 Provision (benefit) for income taxes.....425 397 28 Profit of consolidated companies .. 1,088 1,011 77 Equity in profit (loss) of unconsolidated affiliated companies. 5 5 Equity in profit of Financial Products subsidiaries ...... 73 (73) 6 Profit of consolidated and affiliated companies ............. 1,093 1,089 77 (73) Less: Profit (loss) attributable to noncontrolling interests .... 1 (3) 4 Profit 7 .$ 1,092 $ 1,092 $ 73 $ (73) Caterpillar Inc. Supplemental Data for Results of Operations For the Three Months Ended March 31, 2019 (Unaudited) (Millions of dollars) Supplemental Consolidating Data Consolidated Machinery, Energy & Transportation 1 Financial Products Consolidating Adjustments Sales and revenues: Sales of Machinery, Energy & Transportation............. $ 12,724 $ 12,724 $ $ Revenues of Financial Products ................................. 742 870 (128) 2 Total sales and revenues ............................................ 13,466 12,724 870 (128) Operating costs: Cost of goods sold ...................................................... 9,003 9,003 Selling, general and administrative expenses ............ 1,319 1,127 192 Research and development expenses ....................... 435 435 Interest expense of Financial Products....................... 190 200 (10) 4 Other operating (income) expenses ........................... 312 10 313 (11) 3 Total operating costs................................................... 11,259 10,575 705 (21) Operating profit ....2,207 2,149 165 (107) Interest expense excluding Financial Products .......... 103 110 (7) 4 Other income (expense) .160 19 41 100 5 Consolidated profit before taxes . 2,264 2,058 206 Provision (benefit) for income taxes 387 335 52 Profit of consolidated companies.1,877 1,723 154 Equity in profit (loss) of unconsolidated affiliated companies 7 7 Equity in profit of Financial Products subsidiaries...... 148 (148) 6 Profit of consolidated and affiliated companies.1,884 1,878 154 (148) Less: Profit (loss) attributable to noncontrolling interests ..3 (3) 6 Profit 7 $ 1,881 $ 1,881 $ 148 $ (148)