Interpreting Financial results final11
Interpreting Financial Results
Interpreting Financial Results
Interpreting Financial Results
Financial ratios analysis shows the connections concerning the facets of the company’s dealings and delivers to the public the companies’ situation and performance. Financial ratios could offer signs and indications of the financial situation and warnings of possible problem areas.
I was assigned the Waste Management Inc. company they the “leading provider of comprehensive waste management services in North America. The subsidiaries provide collection, transfer, recycling, and disposal services. They are also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the United States” (SEC.gov, 2013)
This paper contains Waste Management Inc. financial reports from the years 2010 through 2013. I used the company’s last four years of balance sheet to calculate and compare numerous financial ratios against the company’s industry benchmarks. Waste Management, Inc.’s statement is separated by three categories; solvency, efficiency and profitability. Due to its complications in the fact that it’s a service industry and not sales industry, some of the figures are different from a sales company.
Solvency ratios
Current Ratio
The current ratio of Waste Management Inc. shows 0.77, 0.80 and 0.83 for years 2011 through 2013.The formula I used is “cash & bank balance+ acct. receivable year) / total current liabilities of year” (Mergentkbr, 2014). It is trending upward but shows that it’s slight below the industry standard which shows 1.0, 1.0, and 1.0 from 2011, 2012 and 2013. According to our text book, the higher the current ratio the healthier the company becomes. By not meeting the industry standards, this can make investors leave and look for different companies to invest on.
Quick ratio
The quick ratio shows that in 2011, 2012, and 2013 resulted in .72, .74 and .77. the formula I used is “total current assets of year / total
Interpreting Financial Results
Interpreting Financial Results
Financial ratios analysis shows the connections concerning the facets of the company’s dealings and delivers to the public the companies’ situation and performance. Financial ratios could offer signs and indications of the financial situation and warnings of possible problem areas.
I was assigned the Waste Management Inc. company they the “leading provider of comprehensive waste management services in North America. The subsidiaries provide collection, transfer, recycling, and disposal services. They are also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the United States” (SEC.gov, 2013)
This paper contains Waste Management Inc. financial reports from the years 2010 through 2013. I used the company’s last four years of balance sheet to calculate and compare numerous financial ratios against the company’s industry benchmarks. Waste Management, Inc.’s statement is separated by three categories; solvency, efficiency and profitability. Due to its complications in the fact that it’s a service industry and not sales industry, some of the figures are different from a sales company.
Solvency ratios
Current Ratio
The current ratio of Waste Management Inc. shows 0.77, 0.80 and 0.83 for years 2011 through 2013.The formula I used is “cash & bank balance+ acct. receivable year) / total current liabilities of year” (Mergentkbr, 2014). It is trending upward but shows that it’s slight below the industry standard which shows 1.0, 1.0, and 1.0 from 2011, 2012 and 2013. According to our text book, the higher the current ratio the healthier the company becomes. By not meeting the industry standards, this can make investors leave and look for different companies to invest on.
Quick ratio
The quick ratio shows that in 2011, 2012, and 2013 resulted in .72, .74 and .77. the formula I used is “total current assets of year / total
References: http://www.sec.gov/Archives/edgar/data/823768/000119312512065370/d260235d10k.htm http://www.mergentkbr.com.ezproxy.apollolibrary.com/index.php/reports/industry