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The Income Statement and Balance Sheet belonging to MicroDrive Inc. is given to you to answer the following questions about the companys financial health in
The Income Statement and Balance Sheet belonging to MicroDrive Inc. is given to you to answer the following questions about the companys financial health in 2009 and 2010. As an investor, you are required to analyze these statements using the appropriate ratios, make a comment on the firms financial performance and how it has changed between the two years. (Please use the appropriate financial ratios to answer the questions.)
- How liquid is the firm? Will it be able to pay its bills as they come due?
- How has the firm financed the purchase of its assets?
- How efficient has the firms management been in utilizing its assets to generate sales?
- Has the firm earned adequate returns on its investments?
- Are the firms managers creating value for shareholders?
- Will you invest in this company? Why?
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