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Prepare a vertical analysis for each company
Course:- Other Subject
Reference No.:- EM13829662




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As the CFO of your corporation, you are in charge of preparing and analyzing financial statements that will be presented to potential investors and creditors. However, before you can present the financial statements to investors and creditors, you need to prepare the financial statements with supporting analysis. Select one (1) pair of the following companies to conduct your financial statement analysis.

  • Pepsi versus Coca Cola, or
  • Amazon versus eBay
  • Target versus Walmart
  • Nike versus Reebok

Write a six 6 page paper in which you:

  1. Analyze each company's history, product / services, major customers, major suppliers, and leadership, and provide a synopsis of each company.
  2. Identify three (3) profitability ratios that creditors may be interested in. Calculate the ratio for each company, and prepare a report to summarize your findings on the financial health of each company. Also, recommend to management the manner in which they can improve each of the three (3) ratios identified.
  3. Summarize at least two (2) news events (this may include mergers, acquisitions, or political issues) that occurred from 2012 to the present day, and analyze the impact that these events had on each company's financial statements. Indicate the primary way in which the merger, acquisition or political issues influence potential investors' and creditors' perception of both companies.
  4. Analyze each company's income statement over the past two (2) years, and determine which company outperformed the other. Suggest a way in which the lagging company can improve its income. Support your suggestion with a specific analysis.
  5. Analyze each company's balance sheet. Prepare a vertical analysis for each company, interpret the results, and write a financial report. Also, suggest the manner in which the company that is not performing well can improve its balance sheet in order for it to be attractive to potential investors.
  6. Use at least four (4) quality academic resources in this assignment. 

Your assignment must follow these formatting requirements:

  • Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.
  • Include a cover page containing the title of the assignment, the student's name, the professor's name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.

The specific course learning outcomes associated with this assignment are:

  • Prepare and analyze financial statements including the balance sheet, income statement, and statement of cash flow according to GAAP and IFRS.
  • Calculate financial ratios, interpret results, and draw conclusions.
  • Use technology and information resources to research issues in financial accounting.
  • Write clearly and concisely about financial accounting using proper writing mechanics.
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INTRODUCTION:

Target is a United States Based Retail firm which was founded in the year 1902 in Minneapolis. It’s the 2nd largest retail firm in the US behind Walmart. It sells almost every major household products, electronic items, clothing’s and daily needs.

It operates more than 2000 stores in the North American segment in US and Canada. However owing to heavy losses the firm has decided to shut down the whole operations in Canadian Area in 2015.

Walmart on the other hand is the single largest retailer in the world. It operates stores in Asia, North America, South America and Europe. Established in the year 1962 by Sam Walton in Bentonville, Arkansas it has grown by leaps and bounds to be the no 1 player in the world. It operates more than 5500 stores worldwide with revenue touching $300bn a year. It also tops the Fortune 500 list for many years now.




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