Accounting and Finance Foundations

Unit 11

Accounting and Finance Foundations Unit 11: Financial Analysis 833

Financial Analysis

Chapter 23

Industry Standard Comparison - Complete the chart for each item.

Industry

Standard

Percentage

Clark Co.

Actual

Percentage

Acceptable

Result

Component Yes No Recommended Action (If Needed)

Cost of Merchandise SoldNo more than

60%

Gross Profit on Sales No less than

40%

Total Operating Expenses No more than

30 %

Net Income No less than

10 %

RATIO ANALYSIS - KEY PERFORMANCE INDICATORS - Calculate the following performance ratios for Clark Corporation.

1. Current Ratio


2. Debt Ratio


3. Profit Margin


4. Inventory Turnover


5. Return on Assets

23.3.3 Vertical, Horizontal, Ratio, & Industry Analyses (cont’d)

Clark Corporation (cont’d)

Student Assignment