The company that I have selected for Financial Ratio analysis is GOOGLE. The Ratios that I am going to analyze are grouped under four main headings: 1) Profitability Ratio 2) Liquidity Ratio 3) Debt Ratio 4) Market Ratio 1. Profitability Ratio - Profitability ratios measure the firm ’s use of its assets and control of its expenses to generate an acceptable rate of return. a. ROE - Return On Equity - Measures the rate of return on the ownership interest (shareholders ’ equity) of the common
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Financial ratios are used by companies‚ investors‚ and by students. The purpose of financial ratios is to determine the whether a company is able to pay off debts‚ use its assets to regenerate cash‚ or determine how much profit a company is making from every dollar they make. A study of two internet giants‚ Google and Yahoo!‚ will show that although one company is not generating as much as the other is‚ there are ways that it can improve future cash flows. Current RatioThe current ratio of an organization
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1. Introduction This report provides a financial quarterly trend analysis for Costco Wholesale Corporation‚ Inc. founded in 1983. Costco Wholesale Corporation is the seventh largest retailer company in the world. As of July 2012‚ it was the fifth largest retailer‚ and the largest membership warehouse club chain in the United States ("Wikipedia‚ the free‚" 2011). Costco Wholesale Corporation’s stock is publicly traded on the National Association of Securities Dealers Automated Quotation (NASDAQ)
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Financial Ratios The creditable performance calculation for the Valley of the Sun United Way (VSUW) is used to guarantee that their organization will perform at their most likely current ratio‚ long-term solvency ratio‚ contribution ratio‚ and general and management/expense ratio (Goetsch & Davis‚ 2010). The current ratio will enable VSUW to easily see their current expenses that may be aquired and make sure that the organization has enough resources to pay all of their current obligations
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http://www.investopedia.com/university/ratios/liquidity-measurement/default.asp LIQUIDITY RATIOS: The first ratios we’ll take a look at in this tutorial are the liquidity ratios. Liquidity ratios attempt to measure a company’s ability to pay off its short-term debt obligations. This is done by comparing a company’s most liquid assets (or‚ those that can be easily converted to cash)‚ its short-term liabilities. In general‚ the greater the coverage of liquid assets to short-term liabilities the
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American International University Bangladesh Spring‚ 2012 Assignment Subject: Ratio Analysis of Agriculture Marketing Company Limited (PRAN) Prepared For TABASSUM‚ NAFEESA Faculty‚ BBA Prepared By Adnan Mohd. 08-11093-2 Mamoon Mansoor Mustafee 08-11905-3 Poonam Nazia 09-14141-2 Acknowledgement The success of this project work depends on the contribution of a number of people‚ especially
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FINANCIAL RATIOS LIQUIDITY RATIOS Current Ratio: = current assets / current liabilities ▪ The higher the ratio‚ the greater the "cushion" between current obligations and a firm ’s ability to meet them. ▪ Use: An indication of a company ’s ability to meet short-term debt obligations; the higher the ratio‚ the more liquid the company is. Current ratio is equal to current assets divided by current liabilities. If the current assets of a company are more than twice the current liabilities
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adequacy of income by comparing it to other items reported on the financial statements. 1) Return on Equity: One of the most important profitability ratios is return on equity (ROE). ROE is the amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation’s profitability by revealing how much profit a company generates with the money shareholders have invested. The return on equity ratio is computed as follows: Return on Equity = | Net Income |
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FINANCIAL RATIOS Gross Profit to Sales (Gross Profit Ratio): profitability ratio that shows the relationship between gross profit and total net sales revenue. Gross margin/Net sales The gross margin is not an exact estimate of the company’s pricing strategy but it does give a good indication of financial health. Without an adequate gross margin‚ a company will be unable to pay its operating and other expenses and build for the future. In general‚ a company’s gross profit margin should be stable
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Basic Financial Calculations 1.1 Overview This chapter aims to give you some fi nance basics and their Excel implementation. If you have had a good introductory course in fi nance‚ this chapter is likely to be at best a refresher.1 This chapter covers • Net present value (NPV) • Internal rate of return (IRR) • Payment schedules and loan tables • Future value • Pension and accumulation problems • Continuously compounded interest Almost all fi nancial problems center on fi nding the value
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