Posted: September 19th, 2015
The purpose of the second part of the comprehensive project is to compute financial statement ratios.
A. Based on formulas given in Appendix B, compute the following ratios in Excel for two years.
1. Debt ratio
2. Gross profit margin
3. Free cash flow
4. Times interest earned
5. Accounts receivable turnover
6. Inventory turnover
B. Prepare a DuPont Analysis of ROE for two years, including computations of __________________.
1. Return on Sales
2. Asset Turnover
3. Return on Assets
4. Financial Leverage
5. Return on Equity
C. Briefly evaluate the ratio trends. Indicate on your worksheet whether each ratio is ______________.
1. stronger / weaker
2. quicker / slower
3. more / less liquid
4. more / less risk
D. Submit a report. Write a min of 3 full page report evaluating trends in all of the above ratios. Discuss whether your company’s profitability, efficiency, liquidity, and solvency are improving or deteriorating. Format: Double-spaced, one-inch margins, using a 12-point Times New Roman font.
Use the American Psychological Association (APA) style (6th edition) for writing your assignment.
Format and Title the selected current event is relevant, focused, and creative (one that is not traditionally looked at); the introduction presents a concise and clear outline of the paper.
Content of the Outline The current event is clearly described, and its relationship with ethics and/or financial international business is provided in a concise, in-depth description
Design process Information about similarities and differences with module notes, reading and videos is provided in a concise, in-depth description which includes their relation with management situations
Reference page correct. Use the Purdue OWL https://owl.english.purdue.edu/owl/resource
Wahlen, J. M., Baginski, S. P., & Bradshaw, M. (2015). Financial reporting, financial statement analysis and valuation. (8th ed.). Cengage
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