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Financial Metrics Year 1 Year 2 Year 3 Liquidity Ratios - Current Ratio 3.2 3.6 3.9 - Quick Ratio 2.5 2.8 3.2 Profitability Ratios -
Financial Metrics | Year 1 | Year 2 | Year 3 |
---|---|---|---|
Liquidity Ratios | |||
- Current Ratio | 3.2 | 3.6 | 3.9 |
- Quick Ratio | 2.5 | 2.8 | 3.2 |
Profitability Ratios | |||
- Net Profit Margin | 18% | 20% | 22% |
- Return on Assets (ROA) | 12% | 14% | 16% |
Efficiency Ratios | |||
- Inventory Turnover | 8 times | 9 times | 10 times |
- Accounts Receivable Turnover | 14 times | 16 times | 18 times |
Trend Analysis | Increasing | Increasing | Increasing |
Financial Statement Analysis | |||
- Horizontal Analysis | |||
- Vertical Analysis |
Requirements:
- Compute liquidity ratios (current ratio, quick ratio) for Company WWW for three consecutive years.
- Determine profitability ratios (net profit margin, return on assets) for the same period.
- Analyze efficiency ratios (inventory turnover, accounts receivable turnover) for each year.
- Perform trend analysis for each ratio.
- Perform horizontal analysis of financial statements.
- Conduct vertical analysis of financial statements.
- Ensure all ratios are correctly calculated.
- Provide interpretations for the trends observed.
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