Financial Report on John Deer

Topics: Generally Accepted Accounting Principles, Balance sheet, Financial ratios Pages: 3 (937 words) Published: April 24, 2012
Adrian Bryant
March 15, 2012
Investments
Dr. Wokukwu
Deere & Company
Deere & Company's is an agricultural based company located in Moline, Illinois. It also operates under the name John Deere. Deere & Company's Standard Industry Code (SIC) is 3523,Farm Machinery and Equipment. Deere & Company's Industry Average is -1.69.

According to Deere & Company, the company maintains a strong financial condition. The company stated that powerful global economic trends are lending support to its current performance and future prospects. John Deere has decided to extend its brand to a wider worldwide audience. The company has received many awards globally for its highly advanced products and features.

Deere introduced a series of rigorous competencies for its leaders during the year. Its aim is to drive higher, more sustainable levels of employee engagement while tying the role of managers throughout the organization more directly to the company's business goals. According to the company, it remains well-positioned to capture the economic tailwinds that hold such promise for its future. Liquidity and Efficiency

Current Ratio: A company's current ratio measures its short-term debt-paying ability by dividing current assets by current liabilities. 2009 Current Ratio = (4651.7+192.0+38.4+2616.9+15254.7+3108.4+864.5+1733.3+2397.3)/(7158.9+55.0+5371.4) = 30857.2/12585.3 = 2.45 2010 Current Ratio= (3790.6 +227.9 + 38.8 + 3464.2 + 17682.2 +2238.3 +925.6+1936.2+3063.0)/ (7534.5 +203.5 +6481.7) = 33366.8/14219.7= 2.35

Since Deere's current ratio decreased its ability to pay short-term debt also decreased. Acid Test Ratio: measures intermediate short-term debt-paying ability by adding cash, short-term investments, and current receivables and dividing the sum by current liabilities. 2009 Acid Test Ratio =( 30857.2 – 2397.3)/12585.3 = 2.26

2010 Acid Test Ratio = (33366.8-3063.0)/14219.7 = 2.13
Accounts Receivable Turnover: measures efficiency of collection by dividing Net...
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