Question
I am working on a financial analysis project and I need help to understand what all this data means, and if there is any assumptions
I am working on a financial analysis project and I need help to understand what all this data means, and if there is any assumptions about this company that can be made from all this data.
Liquidity and Efficiency:
Current Ratio: Current Assets/Current Liabilities
129,095/352,928 = 0.37:1
Total Asset Turnover: Net Sales/Average Total Assets
3,545,794/(1,902,637 + 1,833,301/2); 3,545,794/1,867,969 = 1.9
Inventory turnover: Cost of Goods Sold/Average Inventory
2,301,181/(338,590 + 330,223/2); 2,301,181/334,407 = 6.9 times
Solvency:
Debt Ratio: total liabilities/Total Assets
589,553/1,313,084 =0.45
Debt to Equity Ratio: total Liabilities/Stockholders Equity
589,553/1,313,084 = 0.45
Equity Ratio: Total Stockholders Equity/Total Assets
1,313,084/1902,637 = 0.69
Profitability:
Profit Margin: net income/net sales
218,120/3,545,794 = 6.2%
Return on total assets: Net Income/Average Total Assets
218,120/(1,902,637 + 1,833,301/2); 218,120/1,867,969 = 11.7%
Return on Common Stockholders Equity: Net Income/Shareholders Equity
218120/(1,313,084 + 1,137,227/2); 218,120/1,225,156 = 17.8%
Market Prospect:
Price-Earnings Ratio: market-price per common share/Earnings per share
35.88-1.87 =19.19 times
Horizontal Analysis | ||||
Fiscal Period | 2017 | 2016 | Dollar Change | Percent Change |
Current Assets | ||||
Cash and cash equivalents | $248,140 | $265,276 | $(17,136) | -6.50% |
Marketable securities | $111,067 | $61,061 | $50,006 | 81.9% |
Accounts receivable | $54,505 | $75,723 | $(21,218) | -28.0% |
Inventory | $338,590 | $330,223 | $8,367 | 2.5% |
Prepaid Expenses | $129,095 | $102,078 | $27,017 | 26.5% |
Total | $881,397 | $834,361 | $47,036 | 76.4% |
Trend Analysis | ||||
Fiscal Period | 2017 | 2016 | 2015 | 2014 |
Current Assets | ||||
Cash and cash equivalents | 102.50% | 109.60% | 63.90% | 100.00% |
Marketable securities | 39.4% | 21.7% | 37.0% | 100.00% |
Accounts receivable | 98.8% | 137.3% | 127.7% | 100.00% |
Inventory | 108.8% | 106.1% | 115.1% | 100.00% |
Prepaid Expenses | 170.0% | 134.4% | 135.4% | 100.00% |
Total | 519.5% | 509.1% | 479.1% | 100.00% |
Common-Size Analysis | ||
Fiscal Period | 2017 | 2016 |
Current Assets | ||
Cash and cash equivalents | 13.0% | 14.5% |
Marketable securities | 5.8% | 3.3% |
Accounts receivable | 2.9% | 4.1% |
Inventory | 17.8% | 18.0% |
Prepaid Expenses | 6.8% | 5.6% |
Total | 46.3% | 45.5% |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started