Finacial Analysis Staples & Office Depot

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Table of Contents
Introduction
Overview of Staples, Inc. and Office Depot, Inc. ………………………………..……3 Case Objectives…….……………………………………………..………………..…….4 Financial Analysis
Common-Size Vertical Analysis & Comparative Horizontal Analysis Common-Size Balance Sheet ….…………….……….……………..….……….4 Common-Size Consolidated Statement of Income…………….………..……. 5 Comparative Balance Sheet ….…………….……………………………..…….6 Comparative Consolidated Statement of Income……..……..……………….. 7 Financial Ratio Analysis

Liquidity Ratios….………..………………………………………………..…….8 Long-Term Debt – Paying Ability………………………..…..………………..10 Profitability & Investor Analysis………..……………….…………….………11 Conclusion & Recommendation……………………………………………………………….13 References…………………………….……………………………………………..…..………14 Appendices ………………………………………..….…………………………………………15 Introduction

Overview of Staples, Inc. and Office Depot, Inc.
Staples Inc. and Office Depot Inc., are two companies that deal with offices supplies and compete with each another. The two organizations sell similar products and try to price match items to encourage more customer revenue. Like other organizations, they both encourage customers to buy the product as well as offering deals that would make customers walk inside their stores. They also have similar accounting and financial statements that make the organization a more reliable one. Staples is a large office supply chain store with over 2000 stores worldwide operating in 26 countries. It is a fast growing industry which provides supplies for both school and business. These products consist from erasers to fast high definition computers and have grown to include television sets and furniture for offices. Its founder, Tom Stemberg, a former supermarket chain executive was working over the Fourth of July weekend on a business proposal when his printer ribbon broke because it was the holiday weekend, all the local suppliers and stationery stores were closed. After driving from store to store and still not finding the correct ribbon, Tom came to a realization: The world needed a supermarket for office products. Ten months later, Staples, the first office superstore, was open for business. It was founded to make it easy for small business owners as well as other consumers, and the stores feature convenient locations, hours, and a great selection of products and services at competitive everyday prices. Infact, what started off in the town of Brighton, Massachusetts has now grown to a worldwide organization. Office depot was established in 1986 in Fort Lauderdale, Florida and at the time had an annual sale of $2 million. As of today office depot has 1000 stores and sales up to about $15 billion annually in recent years. Its founders, the late F. Patrick Sher and Jack Kopkin envisioned a warehouse-style store for office products where customers could purchase items in bulk for discounted prices. This concept lead to starting Office Depot, and the first store at Lakes Mall in Lauderdale Lakes, Florida was opened. The company has experienced steady growth throughout the years since its inception in 1986. Case Objectives

The main objective of this financial analysis is to compare Staples Inc., and Office Depot Inc. with respect to their financial performance covering the years from 2008 through 2010. Based on the balance sheets, consolidated income statements and other financial information that are made available through the websites of these companies and also retrievable via the SEC website, common-size vertical and horizontal analysis as well as financial ratios would be generated. These findings will hence present trends and analysis portraying liquidity, long-term debt – paying ability, profitability and investor analysis ratios. Financial Analysis

Common-Size Vertical Analysis & Comparative Horizontal Analysis
Common-Size Balance Sheet
The vertical analysis of the balance sheets for both companies is based upon total assets. We recall that total...
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