using cash flows from operations‚ from investing activities‚ and from financing activities‚ while‚ as measures of operating efficiency‚ its return on assets (ROA)‚ return on sales (ROS)‚ and asset turnover are evaluated. ROA and ROS are used for the DuPont Equation. Economic profit‚ breakeven‚ and capital structure analyses are performed‚ as debt-to-equity ratio and leverage ratio are computed given the ROA and ROE. Lastly‚ some interesting findings are enumerated and explored at the end of the report
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ACCOUNTING 231 – RATIOS USED FOR ANALYSIS - Spring 2013 Explanations for each ratio‚ display format‚ type of ratio‚ and what it is used for‚ etc. General Ratios: Horizontal Analysis (Growth Rate (GR)): (Current Year – Prior Year) / Prior Year Measures change in $ numbers for one year to another. Percentage. General Used to compare same line item to itself between periods. Note 1: Can also be used to measure change in $ from Current year to Base year: CY – BY / BY Note 2: Can also be used to measure
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The optimal capital structure Is there such a thing? Is there an Optimal Capital Structure? • Miller and Modigliani: • 1. You cannot derive value from financing strategies. If you finance with debt in a world with taxes‚ then you might add value from interest payments tax shields • Question: • If this is true for everyone‚ then why do not find more debt financing in more companies‚ i.e you find little debt in technological companies Myers and the Pecking Order • Prof. Myers found the following
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Navarro CMR fa05 10/21/05 7:06 PM Page 1 The Well-Timed Strategy: MANAGING THE BUSINESS CYCLE Peter Navarro S ome companies appear to exhibit considerable skill in managing the business cycle. For example‚ during the 2001 recession‚ Lowe’s employed an aggressive countercyclical capital expansion strategy to significantly outperform a cost-cutting and retrenching Home Depot. Dell countercyclically increased its advertising budget and gained market share from key rivals such
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FIN 470 Exam1 - KEY 1. What is the primary disadvantage of the corporate form of organization? Name at least two advantages of corporate organization. The primary disadvantage of the corporate form is the double taxation to shareholders of distributed earnings and dividends. Some advantages include: limited liability‚ ease of transferability‚ ability to raise capital‚ and unlimited life. 2. Evaluate the following statement: Managers should not focus on the current stock value because doing
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Basic Finance Nicholas Miles MBA 503 Thomas Snow April 4‚ 2007 Group # SV06MBA06 The main purpose of studying finance is to gain an understanding of the financial performance of a company‚ corporation or industry. By looking at a company ’s financial performance‚ decisions can be made about many things by many different players. Corporations are rated by different agencies that examine financial records and potential for growth. Fitch ratings are a good example of this. My employer has an
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factories. Before the changes women had limited career options. In fact the work of a wife was at the side of her husband running a household‚ farm or plantation. "Indeed‚ a wife herself was considered her husband ’s chattel or personal property" (Cullen-Dupont 212). The woman’s role was to cook for the household‚ make clothing‚ spin yarn‚ and weave cloth. Such duties were time consuming and usually took the whole day. After the Revolution and into the early 19th century‚ educating the children became the
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management‚ Debt‚ profitability‚ and market value ratio and compare the two companies by explaining the implications of different ratios. This would enable us to conclude upon whom is in a better position. In addition‚ in this project we will look at the DuPont value‚ which will help us to see whether the company is fully utilizing its Total asset turnover‚ Equity multiplier‚ and profit margin all together. COMPANY OVERVIEW Meghna Petroleum Limited (Target Company): Meghna Petroleum Limited was
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Bed‚ Bath & Beyond Strategies 4 Business Strategy 4 Operating Strategy 4 Expansion Strategy 5 Are these strategies working? 6 Comparison with competition 6 Year-On-Year (YoY) same-store sales 6 Sales per Square Foot 6 Sliding ROE (Explanation using Dupont Analysis) 6 Performance ratios: How has BBBY fared over time? 8 Conclusions 9 Appendix 11 Performance Ratios since 1990 11 Executive Summary Founded in 1971‚ Bed Bath & Beyond (BBBY) was a small chain of stores; they sold bed linens and bath accessories
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2008 to 2010 but they have increased at the same rate as its assets that have increased by 11.9%. So the reduction in ROE is not necessarily bad for Colgate-Palmolive as the ROE has dropped due to increase in assets and reduction in liabilities. DuPont Ratio Components Profitability Profitability has increased from 12.7% in 2008 to 14.9% in 2009 and has dropped to 14.1% in 2010. So to understand the reason behind the drop in profitability‚ we need to look at total sales and net income. Total sales
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