The requirements for the ratio analysis section are as follows.
1. Compute the following for each of the two most recent years.
• Profit margin
• Return on shareholders’ equity
• Current ratio
• Interest coverage ratio
2. Document your work by properly citing items such as the following.
• The website for the company
• The web page link for the annual report
• The page number of the annual report
• Appropriate details of the calculations
The questions that should be addressed in the second section of the paper are as follows.
1. If you were an accountant for a potential vendor for this company, explain which of these ratios would be of the most interest to you. Would there also be a second ratio of interest to you?
2. If you were an accountant for a potential investor in this company, explain which of these ratios would be of the most interest to you. In your opinion, what other ratio or ratios beyond the ones listed above should also be considered in an investment context?
3. What is your overall opinion of this company based on the limited analysis completed via the four ratios? Feel free to mention any questions that you feel should still be considered in view of the ratios or the changes from one year to the next.
Please also consider these suggestions for your success on this assignment.
• If you choose a company from the list and have any trouble finding its website, the annual reports, or specific information, consider selecting a different company from the list instead.
• If the company has subsidiaries, be sure to use the consolidated financial statements.
• Be sure to use the financial statements rather than summaries elsewhere in the annual report.
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