This website uses cookies to ensure you have the best experience.

731 words - 3 pages

Chapter 3 Analyzing Financial Statement Five major areas to analyze. (1) (2) (3) (4) (5) (1) a) Liquidity Position Management of Assets Management of Debt Company's Profitability Market's View of Company Liquidity Ratios - use to investigate the relationship between a firm's current (shortterm) assets and current (short-term) liabilities. Current Ratio = Current Assets Current Liabilities Current Assets - Inventory Current Liabilities Cash + Marketable Securities Current Liabilities

b)

Quick Ratio (Acid-test) Cash Ratio

=

c)

=

(2)

Asset Management Ratios - Use to evaluate how efficiently management employs assets.

Inventory Management a) b) Inventory Turnover Days’ ...view middle of the document...

Profit Margin Basic Earnings Power Return on Assets (ROA) Return on Equity (ROE) Dividend Payout = = = = = Net Income Sales EBIT Total Assets Net Income Total Assets Net Income Common Stockholders’ Equity Common Stock Dividends Net Income

(5) a) b) (b)

Market Ratios - use to determine how market views company Market-to-Book = Stock Price Book Value / share Stock Price EPS PE Ratio e(gEPS)

Price-Earnings (PE) = PEG =

Du Pont Analysis
The DuPont equation provides us a method to evaluate the components that make up ROE. ROE = Net Income Common Stock Equity

ROE = (ROA)*(Equity Multiplier Ratio) remember: ROA = Net Income Total Assets Total Assets Common Stock Equity

Equity Multiplier Ratio =

shows the asset base supported by common equity; high equity multiplier shows a lot of risk or may be due to low market value relative to book value. ROE = ROE = (ROA) Net Income Total Assets * * (Equity Multiplier Ratio) Total Assets Common Stock Equity

ROA = (Profit Margin)*(Total Asset Turnover) where: Profit Margin Total Asset Turnover = = Net Income Sales Sales Total Assets Extended DuPont Equation may be most beneficial to use as analysis tool. ROE = PROFIT * MARGIN Net Income Sales * TOTAL ASSET Sales Total Assets * EQUITY MULTIPIER RATIO Total Assets Common Stock Equity

ROE =

*

ROE is separated into profitability of each \$ of sales (profit margin),...

## Other Papers Like Business and Me

### Me N My College Essay

4084 words - 17 pages Management 1 Management Management in all business and organizational activities is the act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resourcing encompasses

### Me Essay

2404 words - 10 pages Describe the System of Trial by Jury. Should the System remain as it is at Present? The jury's job is to use the facts given from both the defence and the prosecution and to use evidence alone, to decide if the defendant is guilty or not guilty. Since 1972, names have been randomly selected from the electoral role. These people are then called up to do 'jury service'. Jury service is compulsory unless excused. To qualify for jury service, you

### Me Me Me Me

686 words - 3 pages De’Mon Simpson Dr. Robinson April 2012 SOC/320 University of Phoenix WORKSHOP#3 DISCUSSION QUESTIONS * What is the Department of Homeland Security (DHS)? What does the DHS do for United States citizens? The DHS is a cabinet department of the U.S. federal government, created in response to the September 11 attacks, and with the primary responsibility of protecting the U.S.A and the U.S. territories from and responds to terrorist

### Causes for Me Attending College

682 words - 3 pages Cause for Me Attending College Cherry Michelle Underwood Everest College Why am I a college student? Acquiring a college degree is an important part of my professional objectives and life. I am taking a part in college to obtain more comprehension, have the required qualifications to be successful in my profession, and to make my family delighted. I always wanted to manage my own nail and hair salon, so I chose to study Business. As a

### Me Talk Pretty One Day

1366 words - 6 pages Barrie Smith Christie Harper EN105 First Year Writing Seminar 26 October 2013 “Me Talk Pretty One Day” David Sedaris’ essay appears to discuss his experiences as an older man trying to learn the French language abroad. However, what his story really depicts is his ability to overcome his fears and obstacles. Sedaris suggests that we all have fears of being out of our comfort zone and that sometimes when we break habits we become

### A Whole New World: Economics and Me

820 words - 4 pages Jonas Miguel M. Valeza Prof. Rodrigo Dolorosa BSBA HRDM 2-1 Basic Economics with Taxation and Agrarian Reform A Whole New World : Economics and Me Economics is the study of choices and behaviors. Economics focuses on why we make the choices we do and what the implications or effects of those choices are. In this essay, I will talk about the magnificence of Economics and how it has been a part of our daily lives. So what

### Me and Only Me

536 words - 3 pages Favorite Art In the world, there are various kinds of art, music, dance, painting, sculptors, and many others. Each one comes with its own diversity and its own audience. “Beauty” it is said “is in the eye of the beholder.” For me this statement is very true. My favorite art is music and my favorite artist is Dewayne Carter also known as Lil Wayne. There are many reasons why I prefer music to other kinds of art. Music is a form of expression

### Why College Education Is Important to Me

636 words - 3 pages Why college education is important to me Having a college education is important to me because of the economics problem that we are facing in today’s world, having the experience about a job and don’t have the college education to back it up is like a waste of time and it is also like having a garden with a lot of plant and trying to grow them without sunlight and water. With a college degree more windows of opportunities will open, By

### Why College Education Is Important to Me

925 words - 4 pages Receivables explicitly challenged me, and I was good at it. Working predominately at for small family owned businesses that have both benefits and challenges, for me the benefits accommodated my life. While raising children as a single Mother the “family businesses” provided the flexibility that allowed me to attend school events, doctor’s appointments and life events that presented themselves or were important to me. I began my career in

### Morgan Spurlock's Film, Super Size Me

1586 words - 7 pages liver turned to fat, he gained close to 25 pounds, his risk of developing coronary heart disease doubled, and he became depressed among many other things. One can easily argue that Super Size Me was shot in this manner to open the eyes of Americans that are giving business to this massive unhealthy industry. It can be viewed as a form of reporting that reaches a wide audience in every state (Cornell, Lecture #12). Documentaries such as Super

### No One Told Me It Was Wrong

3203 words - 13 pages No One Told Me It Was Wrong As Viet Nam steps into the global economy, its citizens take advantage of any new business opportunities available. From a western point-of-view, a local computer shop might be nothing new, but for a country coming to terms with technology of the 21st century, an internet shop, computer parts and services, or technology education facilities are lucrative and profitable. So profitable, in fact, that along some

## Related Essays

### Me As A Business Management Student

3543 words - 15 pages applications wasn't getting me very far. So, as they drilled into our heads in school, I had to rethink my strategy – and fast! Business Management Overview Job Outlook According to the Bureau of Labor Statistics, sales managers held about 346,900 jobs in 2008. Employment is expected to grow about as fast as average through 2018, and stiff competition is expected for jobs. Companies Hiring Sales Managers * AT&T * Bankers Life &amp

### Me And You Essay

1346 words - 6 pages is just telling them more about the problems that they already know they have. I took the time out to interview a day care provider because I felt that maybe having to deal with the same kids all day everyday would help me get to know them and guide them as they got older. The day care provider’s name is Jalisha Jerome. Here are some of the things that I asked her and her responses. Q 1: What is the name of your business? A: The name of my

### Roger And Me Documentary Analysis

782 words - 4 pages In business, outsourcing is the contracting out of a business process to a third-party. To all those in power it is a worthwhile task to complete, with many reeking the positive effects including consumers and the producer, but it is in the documentary Roger and Me directed by Michael Moore that showcases the harsh realities of outsourcing the multimillion dollar company General Motors down to Mexico. The film uses an array of cinematic