Principles of Managerial Accounting

Topics: Financial statements, Ratio, Financial statement analysis Pages: 2 (717 words) Published: November 1, 2014

OL3210--Principles of Managerial Accounting—unit 2 complete There are various ways that financial statement information is presented in this article on Nokia. The first way I see is in the Good News section on page 1 “the bulk of its revenues—more than quadrupled, from $2.1 billion in 1993 to $8.7 billion last year (1997),” and on say “the recent June quarter surging to $616 million, up 76% from the same quarter in 1997” this is an partial example of an horizontal analysis (Stone, 1998). A horizontal analysis also called a trend analysis, provides you with a way to compare your numbers from one period to the next, yet the article did not discuss the entire financial statement (Edmonds, Olds, Tsay, 2008). This particular section only discussed the profitability ratios. The chart on page 11 figures over a 6 year time frame (the last 4 years of this being an estimate of growth) of how the phone has earned Nokia the Big Bang (Stone, 1998). The second chart on page 11 would be considered a stock market ratios of Nokia. Stock Market ratios are existing and potential investors in a company’s stock (Edmonds, Olds, Tsay, 2008). How Nokia stocks have increased from July 97 to July 98, and how the investors are happy with the increase, and there are no projections in this chart. Even though throughout the entire article Nokia is comparing their sales to Motorola, Ericsson and AT&T, and all of a certain span of years many financial statements of used, few are actually put into charts or financial sheets. There is much talk about measures of profitability, net margins, and ratio analysis within the organizations of Nokia and Motorola. Reference

Edmonds, T., Olds, P., Tsay, B.. (2008). Fundamental managerial accounting concepts, 5th edition, chapter 13. McGraw-Hill/Irwin. Stone, A. (1998, August 10). Nokia. Businessweek. Retrieved October 1, 2014, from Case Analysis

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