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Compute the ratio of liabilities to stockholders equity

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Reference no: EM13857591

Annual Report Project

Part 1-

Report 1, Financial Analysis Questions

- Solvency. For both businesses, for the years 2012 and 2013, compute the Current Ratio (p332 of textbook). Give the definition of the current ratio, and state which of the two businesses appear stronger with respect to this ratio, and why.

- Solvency. For both businesses, for the years 2012 and 2013, compute the Quick Ratio (p332 of textbook). Give the definition of the quick ratio, and state which of the two businesses appear stronger with respect to this ratio, and why.

- Solvency. For both businesses, for the years 2012 and 2013, compute the Ratio of Liabilities to Stockholder's Equity (p337 of textbook). Give the definition of this ratio, and state which of the two businesses appear stronger with respect to this ratio, and why.

- Profitability. For both businesses, for the years 2011 - 2013, compare net incomes (or net losses). State which of the two businesses appear stronger with respect to this item, and why.

- Profitability. For both businesses, for the years 2011 - 2013, compare basic earnings per share (given at the bottom of the income statement). State which of the two businesses appear stronger with respect to EPS, and why.

Report 2, Financial Report Questions (For this report, you will need the financial statements and footnotes following the financial statements, and nothing else, from RadioShack's 2013 annual report). Only RadioShack and 2013, nothing else.

Part 2-

Report 1, Financial Analysis Questions

Report 2, Financial Report Questions (For this report, you will need the financial statements and footnotes following the financial statements, and nothing else, from RadioShack's 2013 annual report). Only RadioShack and 2013, nothing else.

1. Describe RadioShack's revenue recognition policy (this is usually in the first footnote, Summary of Significant Accounting Policies).

2. Does RadioShack have any unearned revenues? Please describe what, in your opinion, constitutes this item (also sometimes referred to as deferred revenues).

Part 3-

Report 1, Financial Analysis Questions

- Compute the inventory turnover (p335) and days' sales in inventory (p336) for both businesses for 2013. Draw conclusions.

- Compute the accounts receivable turnover (p334) and days' sales in receivables (p334) for both businesses for 2013. Please note; an alternative formula for days' sales in receivables, that I prefer, is (360/AR turnover). Draw conclusions.

Report 2, Financial Report Questions (For this report, you will need the financial statements and footnotes following the financial statements, and nothing else, from RadioShack's 2013 annual report). Only RadioShack and 2013, nothing else.

1. What inventory cost flow assumption, if any, does RadioShack use, FIFO, LIFO? This information will be in a footnote to the financial statements.

Part 4-

Report 1, Financial Analysis Questions

- For 2013 compute the rate earned on total assets (p339). Draw conclusions.

Report 2, Financial Report Questions (For this report, you will need the financial statements and footnotes following the financial statements, and nothing else, from RadioShack's 2013 annual report). Only RadioShack and 2013, nothing else.

- Name the dollar amounts and categories of plant and equipment. Also state the amount of accumulated depreciation.

Once you have completed the financial analysis questions, please prepare an executive summary of your conclusions regarding the relative financial health of RadioShack and Best Buy over the time period analyzed. The executive summary should be at the front of your report.

Reference no: EM13857591

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