Discuss three potential issues in utilizing ratio analysis

Assignment Help Finance Basics
Reference no: EM131297996

Comparing Financial Ratios & Potential Issues in Ratio Analysis

Comparing Financial Ratios

Go to MSN Money. (https://investing.money.msn.com/investments/key-ratios) and type in a ticker symbol for a company with the first letter (F).

Next, complete the following:

1. Select "Key Ratios" on the left menu panel.

2. There are several categories listed for ratios. Select one "Financial Condition Ratio" and one "Management Efficiency Ratio".

3. Open the Profile section on the left menu panel and you will see "Industry" is identified. Find a competitive company within that industry and compare those ratios to the ones you just found.

Examine your findings and determine whether your company outperforms its competition based on financial ratios. Identify where your firm seems to lag. Describe how your firm compares with the industry and speculate as to why you believe your firm is performing as it is.

Develop a 200 - 300 word explanation supporting your findings

Potential Issues in Ratio Analysis

As your text describes, ratio analysis is a common technique in financial analysis. One of your colleagues states that a thorough ratio analysis is all that is needed in considering the financial health of a company. Although you agree that ratio analysis is a helpful guide, there may be some potential pitfalls in ratio analysis.

Discuss at least three potential issues in utilizing ratio analysis that you would share with your colleague. In addition, calculate a liquidity, profitability, and efficiency ratio from your Week Six company to demonstrate your observations.

Develop a 200 - 300 word explanation supporting your findings.

Reference no: EM131297996

Questions Cloud

Why might the production quality decline : If Sue creates a bonus plan that offers a bonus to any employee who signs up new members, why might the production quality decline?
Suppose firm is considering labor-saving investment : Suppose a firm is considering a labor-saving investment. In year 0, the project requires an $11,700 investment in equipment (all figures are in thousands of dollars). This investment is depreciated using the straight-line method over five years and t..
Explain why a bonus plan for high performance : Explain why a bonus plan for high performance may be more difficult to implement in a service firm such as CHC than for a manufacturing firm?
Does firm periodically provide special training to employees : If so, are the bonuses tied to employee performance? Provide details ? Does the firm offer any other programs that are designed to achieve employee satisfaction, such as a flexible work schedule? If so, provide details.
Discuss three potential issues in utilizing ratio analysis : Discuss at least three potential issues in utilizing ratio analysis that you would share with your colleague. In addition, calculate a liquidity, profitability, and efficiency ratio from your Week Six company to demonstrate your observations.
Draw graphs of the u.s. strawberry market : Draw graphs of the U.S. strawberry market in long-run equilibrium before the pollution crackdown: one of the U.S. market and one of a California grower. Now show the short-run effects of the pollution crackdown.
How the business uses technology to hire and train employees : Explain how the business uses technology to hire, train, and evaluate employees.- Summarize any recent news story about the firm that applies to one or more of the key concepts.
What is the value of the property if required initial return : Suppose an office building has a single tenant who pays $50,000 per year at the end of each year in a 5-year triple-net lease (annual payments). At the end of 10 years, just after collecting the rent for that year, you expect to sell the building for..
List the similarities between jewish moroccan-bakk ashot : List the Similarities and Differences between Jewish - Moroccan 'Bakk ashot' and Jewish - Ottoman 'Maftirim'.

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd