Академический Документы
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Your group has been hired to analyze the performance of these companies, specifically; they would
like to know what has happened to the companies over time and in relation to its competitors.
Further, they would appreciate any suggestions you have as to how to improve the companies’
performances.
You decide to approach this in two steps. In the first step you’ll perform a competitive analysis to
determine how each has been performing relative the other. In the second step, you’ll analyze both
companies most recent financial report in order to evaluate their individual performance from one
BERGES 1
year to the next. You will have to obtain the financial statements via the internet at www.sec.gov/
and may include relevant portions of the statements as an attachment to your report (do not include
the entire 10K or the entire footnotes as attachments).
Prior Year
Company Total Sales Gross Profit Operating Net Profit Return on Return on
(millions) Margin Margin Margin Assets Equity
Prior Year
Turnover Ratios (in days)
Company Accounts Inventory Accounts
Rec. (use Payable *
net A/R)
*Accounts payable turnover is the number of times that accounts payable are paid during the accounting period. This ratio equals:
Accounts Payable Turnover (X) =[COGS + the increase in inventory (or – the decrease in inventory)] / Avg. Accounts Payable
Similar to the Accounts Receivable and Inventory Turnover ratios, this ratio can also be expressed in days to determine how long, on average, the
company takes to pay its accounts payable.
BERGES 2
C. Financial Position
Assess the liquidity and capital structure of the two firms, using the ratios below. Which firm has
the greatest liquidity? Are their capital structures similar?
Prior Year
Company Current Ratio Quick Ratio Total Assets Debt/Equity Debt/Total
(millions) Assets
SUMMARY
Your final report should include a cover page that includes the class name, section number, date and
names of all group members. It should also include a table of contents and an executive summary.
An executive summary is typically a 2-3 page discussion which outlines the main points of the
project and the conclusion. An executive summary does not introduce new information. The main
body of the report should include the following sections: Introduction, Operating Performance and
Profitability, Activity and Efficiency, Financial Position, Industry Comparison, Current Events and
Conclusion. You can also add a section titled “Other Significant information” if helpful to the
report. It can include whatever additional information you feel was helpful in researching the
activity and results of these companies (i.e. cash flow or market performance discussions related to
the companies, additional analysis such as vertical or horizontal analysis) The required ratios are
outlined above and are best presented in an appendix so that they can be done in excel. It is helpful
if you show the work in your calculation not merely the computed ratio so that I can see the items
you included in the numerator and demoninator and provided partial credit where an incorrect
assumption may have lead to the wrong ending ratio. The two most recent 10Ks should be used for
“most recent” & “prior year” data. Review articles, news and recent quarterly reportings on these
companies and consider the various effects these items may have on the future financial forecasts
for the company. Using the ratios, the items we discussed in class and the recent news reports on
the assigned companies, what have you learned about these companies and how do they compare to
the rest of their industry in the areas you have analyzed? What have you learned about the overall
industry as a result of this analysis?
Paper should be no longer then 10-12 pages (not including cover page, table of contents, executive
summary, or attachments for table of ratios, articles, etc…). In some cases a ratio may not be
applicable, should this be the case it should be so noted. Please follow format instructions as
outlined in your syllabus and do not attach this form to your report, instead incorporate the
information into your final product.
BERGES 3