Company Financial Analysis Essay
Emirates Computers
Name:
Instructor:
Task:
Date:
Calculate the three (3) liquidity, five (5) financial leverage, six (6) turnover and four (4) profitability ratios for all the years as per example 3.5 in the PowerPoint presentations.
Liquidity;
Current ratio=current assets/current liabilities
2010:29021/19483=1.49
2011:24245/18960=1.28
Quick ratio= (current assets- inventories)/current liabilities
2010: (29021-1301)/19483=1.42
2011: (24245-1051)/18960=1.22
Cash ratio=cash/current liabilities
2010:13913/19483=0.71
2011:10635/18960=0.56
Financial leverage;
Total debt ratio= (total assets-total equity)/total assets
2010: (29021-7766)/29021=0.73
2011: (24245-5641)/24245=0.77
Debt equity ratio=total debt/total equity
2010: 30833/7766=3.97
2011: 28011/5641=4.97
Equity multiplier=total assets/total equity
2010:29021/7766=3.74
2011:24245/5641=4.29
Turnover;
Inventory turnover=cost of goods sold/inventory
2010:49128/1301=37.76
2011:42789/1051=40.71
Days sales inventory=365/inventory
2010:365/1301=0.28
2011:365/1051=0.35
Receivables turnover=sales/account receivables
2010:61494/10136=6.07
2011:52902/8543=6.19
Days sales in receivables=365/receivables turn over
2010:365/10136=0.04
2011:365/8543=0.04
Total assets turn over=sales/total assets
2010:61494/38599=1.59
2011:52902/33652=1.57
Capital intensity=total assets/ sales
2010:38599/61494=0.63
2011:33562/52902=0.63
Profitability ratios;
Profit margin=net income/sales
2010:2635/61494=0.04
2011:1433/52902=0.09
Return on assets=net income/total assets
2010:2635/38599=0.31
2011:1433/33652=0.04
Return on equity=net income/total equity
2010:2635/7766=0.34
2011:1433/5641=0.25
Emirates Computer products and services bring revenue from its sales. Revenues from January 2010 to January 2011 were about 16% that is an increase from the previous years. This was mainly because of the recovery in the economy. A company’s economic health is critical because the products it sells are
Name:
Instructor:
Task:
Date:
Calculate the three (3) liquidity, five (5) financial leverage, six (6) turnover and four (4) profitability ratios for all the years as per example 3.5 in the PowerPoint presentations.
Liquidity;
Current ratio=current assets/current liabilities
2010:29021/19483=1.49
2011:24245/18960=1.28
Quick ratio= (current assets- inventories)/current liabilities
2010: (29021-1301)/19483=1.42
2011: (24245-1051)/18960=1.22
Cash ratio=cash/current liabilities
2010:13913/19483=0.71
2011:10635/18960=0.56
Financial leverage;
Total debt ratio= (total assets-total equity)/total assets
2010: (29021-7766)/29021=0.73
2011: (24245-5641)/24245=0.77
Debt equity ratio=total debt/total equity
2010: 30833/7766=3.97
2011: 28011/5641=4.97
Equity multiplier=total assets/total equity
2010:29021/7766=3.74
2011:24245/5641=4.29
Turnover;
Inventory turnover=cost of goods sold/inventory
2010:49128/1301=37.76
2011:42789/1051=40.71
Days sales inventory=365/inventory
2010:365/1301=0.28
2011:365/1051=0.35
Receivables turnover=sales/account receivables
2010:61494/10136=6.07
2011:52902/8543=6.19
Days sales in receivables=365/receivables turn over
2010:365/10136=0.04
2011:365/8543=0.04
Total assets turn over=sales/total assets
2010:61494/38599=1.59
2011:52902/33652=1.57
Capital intensity=total assets/ sales
2010:38599/61494=0.63
2011:33562/52902=0.63
Profitability ratios;
Profit margin=net income/sales
2010:2635/61494=0.04
2011:1433/52902=0.09
Return on assets=net income/total assets
2010:2635/38599=0.31
2011:1433/33652=0.04
Return on equity=net income/total equity
2010:2635/7766=0.34
2011:1433/5641=0.25
Emirates Computer products and services bring revenue from its sales. Revenues from January 2010 to January 2011 were about 16% that is an increase from the previous years. This was mainly because of the recovery in the economy. A company’s economic health is critical because the products it sells are