ACC 561 WEEK 3 Financial Statement Analysis and Decision Making Activity
ACC 561 WEEK 3 Financial Statement
Analysis and Decision Making Activity
ACC 561 WEEK
3 Financial Statement Analysis and Decision Making Activity
ACC 561 WEEK 3 Financial Statement Analysis
and Decision Making Activity
Purpose of Assignment
The activity requires students to perform research and analysis on
competing companies and the potential implications of international standards.
This real-world analysis is key to understanding how a company’s profitability,
liquidity, and solvency can be useful for all users. Students also learn to
analyze financial statements and use managerial tools to make decisions from an
investor’s and creditor’s standpoint.
Assignment Steps
Resources: U.S. Securities and
Exchange Commission (SEC), websites such as Annual Reports (AnnualReports.com)
Tutorial help on Excel® and Word functions can be found on the Microsoft® Office website. There are
also additional tutorials via the web offering support for Office products.
Select two competing companies,
one of which must be an international company, and locate annual reports for
these two companies on the Internet.
Research the two companies on the
Internet and download the Income Statement, Statement of Shareholders’ Equity,
Balance Sheet, and Statement of Cash Flows.
Develop a minimum 525-word
examination of the financial statements and include the following:
- Make a 5-year trend analysis for each company, using 2011 as
the base year, of:
·
Net sales.
·
Net income. Discuss the
significance of the trend results.
- Compute for 2015 and 2014 the:
·
Debt to assets ratio.
·
Times interest earned. How
would you evaluate each company’s solvency?
- Compute for 2015 and 2014 the:
·
Profit margin.
·
Asset turnover.
·
Return on assets.
·
Return on common stockholders’
equity. How would you evaluate each company’s profitability?
- Evaluate the financial opportunity presented by the
companies. If you were a creditor, which company would you be more likely
to lend money to? Defend your decision.
- Which company would you recommend as an investment?
Discuss the items that were considered in your decision.
- Research global implications for the international company
selected. How might changing environmental factors affect organizational
choices?
- Consider the ethical climate (internal or external) of your
chosen companies. Describe the ethical issues and impact on the
stakeholders. What has been/is being done to resolve these issues? Do you
agree with these methods for resolution? If not, what might you do
differently?
Show your work in Microsoft® Word or Excel®.
Complete calculations/computations using
Microsoft® Word or Excel®.
Include the four financial statements
along with your assignment.
Format your assignment consistent with
APA guidelines.
Click the Assignment Files tab
to submit your assignment.
V112417
ACC 561 WEEK 3 Financial
Statement Analysis and Decision Making Activity
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