General Electric Company Financial Analysis
Business Analysis II: General Electric Company Financial Analysis
Cristina Mota Crespo
University of Phoenix
MGT/521 Management
September 26, 2012
Prof. Elsie Jimenez-Galarza
General Electric Company Financial Analysis
This essay is continuation of the financial evaluation from last week; we had to choose a company among the Fortune 500 in my case I chose GE Company. This Finance is about the study of money, it helps managers and senior leadership in an organization to be able to make better objective decisions (Blacconiere & Hopkins, 2002). Every company must invest in having an accountant which will create financial statements that provides information about the financial performance of a company. Financial analysts write reports and papers for their managers to explain and put into words the findings of these statements; it’s their job to interpret the numbers for those who are not financially inclined. A financial statement analysis is the process of identifying the company’s financial strengths and weaknesses and establishing relationship between the balance sheet and the profit and loss account (Dragolea & Cotirlea, 2009). These analyses play a dominant role in setting the framework of managerial decisions. When measuring the financial health of a company we must have knowledge and answers to certain question like: How much profit is it earning? , On what does it spends its income and where? , What is the source of the revenue?. All the answers to these questions can be found in the company’s financial record and they have to make these records available to the community. These financial records are divided in different parts: balance sheet, prediction of cash flow and the profit and loss records. For an organization to have success and survive all the assets must be greater than the sum of all liabilities. Active assets like cash must cover existent liabilities like justly due utilities, current-year loans or
Cristina Mota Crespo
University of Phoenix
MGT/521 Management
September 26, 2012
Prof. Elsie Jimenez-Galarza
General Electric Company Financial Analysis
This essay is continuation of the financial evaluation from last week; we had to choose a company among the Fortune 500 in my case I chose GE Company. This Finance is about the study of money, it helps managers and senior leadership in an organization to be able to make better objective decisions (Blacconiere & Hopkins, 2002). Every company must invest in having an accountant which will create financial statements that provides information about the financial performance of a company. Financial analysts write reports and papers for their managers to explain and put into words the findings of these statements; it’s their job to interpret the numbers for those who are not financially inclined. A financial statement analysis is the process of identifying the company’s financial strengths and weaknesses and establishing relationship between the balance sheet and the profit and loss account (Dragolea & Cotirlea, 2009). These analyses play a dominant role in setting the framework of managerial decisions. When measuring the financial health of a company we must have knowledge and answers to certain question like: How much profit is it earning? , On what does it spends its income and where? , What is the source of the revenue?. All the answers to these questions can be found in the company’s financial record and they have to make these records available to the community. These financial records are divided in different parts: balance sheet, prediction of cash flow and the profit and loss records. For an organization to have success and survive all the assets must be greater than the sum of all liabilities. Active assets like cash must cover existent liabilities like justly due utilities, current-year loans or