Question
The required tasks are detailed below: (1) Prepare common-size balance sheets and income statements for both companies. Note: Compute for the Fiscal year 2017, 2016
The required tasks are detailed below:
(1) Prepare common-size balance sheets and income statements for both companies. Note: Compute for the Fiscal year 2017, 2016 and 2015.
(2) Prepare comparative analysis (i.e., change of percentage analysis) on income statement and balance sheet for both companies. You should compute for the 2017, 2016 and 2015.
(3) Prepare ratio analyses (for the 2017, 2016 and 2015 time period) for both companies. Take a look at textbook, page 36-37 for formulas. You should include the following ratios in your computations:
Liquidity:
current ratio,
acid-test ratio
Collection period
days to sell inventory
Capital Structure and Solvency:
total debt to equity ratio
Long-term debt to equity
Times interest earned
Asset Utilization:
receivables turnover,
inventory turnover,
total asset turnover,
cash turnover
Profitability:
net profit margin on sales,
gross profit margin on sales,
return on assets (assume tax rate is 35% for every year),
return on common stock equity
Market Measure:
Earnings yield
Dividend payout rate
(4) Comment on the analytical results of the two companies. Your comments should concentrate on the trends across the companies. In addition to contrasting the ratios between the companies, you should interpret the numbers and make suggestions as to why the ratio of one company might be higher/lower than the other.
(6)Appendices.
Include tables and graphs of your numerical analyses.
For both companies, you should report:
common-size statements,
comparative analysis statement,
a table of Financial Statement Ratios, and
Pro Forma statements.
I JUST NEED HELP WITH (4) AND (6)
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