Financial Statements Analysis (Modul 2010-2011)

FINANCIAL STATEMENT ANALYSIS

BRIEF CONCEPT

A. Financial Statement and Analysis

The  four  key  financial  statements  are  (1)  Income  statement,  (2)  Balance  sheet,  
(3)  The statement of stockholders’ equity, and (4) the statement of cash flows.

1. Income Statement

The income statement provides a financial summary of the firm’s operating results during a specific period.

2. Balance Sheet

The  balance  sheet  present  a  summary  statement  of  the  firm’s financial position  at  a  given point in time.

3. The Statement of Retained Earnings

The statement of retained earnings is an abbreviated form of the statement of stockholders’

equity.
















4. The Statement of Cash Flow

The statement of cash flow is a summary of the cash flows over the period of concern.

B. Financial Ratios

                          Ratios                                                                          Formula
                                                        Liquidity Ratios

Current Ratio                                                                                 Current Assets

                                                                                                          Current Liabilities

Quick (acid-test) Ratio                                                  Current Assets – Inventory

                                                                                                          Current Liabilities

Cash Ratio                                                                               Cash + Marketable Securities

                                                                                                            Current Liabilities


                                                         Activity Ratios

Inventory Turnover                                                                              COGS

                                                                                                                   Inventory

Total Asset Turnover                                                                            Sales

                                                                                                                 Total Asset

Average Payment Period                                                           Accounts Payable

                                                                                                     Average Purchased per day

Average Collection Period                                                      Accounts Receivables

                                                                                                            Average Sales per day

                                                                        Debt Ratios

Debt Ratio                                                                                              Total Liabilities  

                                                                                                                        Total Asset

Times Interest Earned Ratio                                                                   EBIT

                                                                                                                        Interest

Fixed-payment Coverage Ratio                                      EBIT + Lease Payment

                                                                         Int. +Lease Payment + [(princ.+Pre.Div)(1-tax)         

                                                               

Profitability Ratio

Gross profit Margin                                                                                Gross Profit

                                                                                                                               Sales

Operating Profit Margin                                                                     Operating Profit

                                                                                                                                Sales

Net Profit Margin                                                                                       Net Profit

                                                                                                                                Sales

EPS                                                                              Earning Available for Common Stockholders

                                                                                   Number shares of Common Stock Outstanding

ROA                                                                                                                   Net Profit

                                                                                                                          Total Asset

ROE                                                                                                                 Net Profit

                                                                                                            Total Stockholders’ Equity

Market Ratios

Price/Earning (P/E) Ratio                                Market Price per Share of Common Stock

                                                                                    Earning Available for Common Stockholders

Market/Book (M/B) Ratio                              Market Price per Share of Common Stock

                                                                                    Book Value per Share of Common Stock