FINANCIAL STATEMENT ANALYSIS INSTRUCTIONS Follow the attached instructions exact

FINANCIAL STATEMENT ANALYSIS INSTRUCTIONS
Follow the attached instructions exactly
Using an Excel spreadsheet* and
your company’s financial statements, compute the following for the most recent two years·
Current ratio (2,13)
·
Working capital (not really
a ratio) (2, 13)
·
Inventory turnover ratio
(6, 13)
·
Accounts Receivable
turnover ratio (8, 13)
·
Debt to total assets
ratio (2, 13)
·
Return on assets (9,13)
·
Asset turnover ratio (9,
13)
·
Return on equity (11, 13)
·
Gross profit ratio (5, 13)
·
Profit margin ratio (5, 13)
Also using the spreadsheet,
prepare the following for the most
recent two years:
·
Comparative Income
Statement – Vertical Analysis
(Illustration 13.12)
·
Comparative Balance Sheet –
Horizontal Analysis
(Illustration 13.11)
Find
industry comparative numbers on the MSN Money website (https://www.msn.com/en-us/money) for the following items calculated in # 2 above:
·
Current Ratio
·
Inventory Turnover
·
Return on Assets
·
Asset Turnover
·
Return on Equity
·
Profit Margin (Net Profit
Margin)
See specific instructions on “Industry
Comparative Ratios” in the Project Folder. The industry comparative
numbers should be the most recent available.
. Using the
information gathered and calculated above, write up an analysis of your
company. Begin with a brief history of the company to help the reader
understand the company. Next include a discussion of the company’s financial
performance as seen through ratios and other calculations, whether favorable or
unfavorable. The analysis should also give a conclusion on how the
company has performed in the past and what its future looks
like.
The analysis is to be
written by you, not copied from a professional analyst’s work. When
writing up the analysis, refer back to the ratios and other calculations above
to support your conclusions. The data should be analyzed from two
different perspectives: across time and across companies (industry
data). Be sure to explain what the calculations mean. The analysis
should be done in a professional manner (typed, double-spaced, 1” margins,
10-12 font, proper grammar, appendices, cover page, graphs, references, etc.).
The written portion of the paper should be about 2-5 pages.