Module 4 – SLP (Financial Statement Analysis)

Module 4 – SLP (Financial Statement Analysis)

The financial statements tell a story about the financial health of a business at a given point in time. The purpose of this assignment is to apply ratio analysis to assess financial health to a publicly held corporation. Use the background information & Financial Statement Analysis (attached) to compute three ratios. Compute one ratio (your choice) for each of the three following categories.

1. Liquidity
2. Debt service
3. Profitability

Comment on the ratios by answering the following questions. Go to IBIS (https://www.ibisworld.com/), locate a U.S. specialty industry report, which you feel is appropriate for the company you are analyzing. Use the statistics tab to view the ratios.

What is the purpose of computing the ratios?

What did you learn from reviewing the three ratios?

What is your conclusion about the health of the company?

How do you evaluate the health of the company relative to the industry average and/or leaders in the industry?

SLP Assignment Expectations

Show the formulas for the computations. Two to three sentences are sufficient to respond to the three questions. Do not use an essay format.

Show sources when appropriate and APA format is suggested, but not required.

Excel is a great tool to make computations and present financial information in an easy to understand format. Write comments below the computations in Excel. Submit only the Excel file. Both content and the clarity of the presentation will be evaluated for grading purposes.

 

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