Purpose of Assignment

The purpose of this assignment is to help students gain a better understanding of the financial statements used for corporate financial reporting and the key ratios used to make business decisions.

Assignment Steps

Select a Fortune 500 Company from one of the following industries:

Pharmaceutical

Energy

Retail

Automotive

Computer Hardware

Review the balance sheet and income statement in the company's 2015 Annual Report.

Calculate the following ratios using Microsoft Excel:

Current Ratio

Quick Ratio

Debt Equity Ratio

Inventory Turnover Ratio

Receivables Turnover Ratio

Total Assets Turnover Ratio

Profit Margin (Net Margin) Ratio

Return on Assets Ratio

Analyze in approximately 1,000 words (I don't deduct points for going over the word count) why each ratio is important for financial decision making. I'm not looking for a definition of the ratio, instead, how is it used for financial analysis, etc.

Submit your analysis as well as your calculations.