Analyzing Financial Statements

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Analyzing Financial Statements

December 16, 2012

Regina Campbell

Calculate the following: Current ratio, long-term solvency ratio, contribution ratio, programs and expense ratio, general and management and expense ratio, fund-raising and expense ratio, and revenue and expense ratio for the years 2003 and 2004.

2003 2004

Current Ratio: .87 .90

Long Term Solvency Ratio: 1.38 2.06

Contribution Ratio: .51 .49

Programs and expense ratio: .72 .77

General/ management/expense ratio: .28 .23

Revenue and Expense ratio: .94 1.11

Include the current ratio, long-term solvency ratio, contribution ratio, programs and expense ratio, general and management and expense ratio, fund-raising and expense ratio, and revenue and expense ratio calculated in the Week Four Assignment.

2002

Current Ratio: .75
Long Term Solvency Ratio: 1.26
Contribution Ratio: .53
Programs and expense ratio: 1.00
General/ management/expense ratio: .30
Revenue and Expense ratio: .98

Provide a 200- to 300-word explanation of the importance of each ratio for all three years listed in Appendix D. Include a statement of whether the organization’s financial picture has improved or not within the 3-year period specified in Appendix D.

The current ratio is something that is used to find out the current liquidity of nonprofit human services organizations. The long-term solvency ratio is just what it means, to determine what the long range of financial solvency of the organization. As well as a lay out of they plan to pay the yearly expenses. The contribution ratio is used to assess the dependency of an organization on its major revenue source....
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