Explain three (3) limitations of the balance sheet, and suggestthe fundamental manner in which a company can overcome each suchlimitation. Provide a rationale for your suggestions. Suppose youare the senior financial analyst at your company, and at the end ofeach month you are required to analyze the companyâs profitability.Prepare a report to management that identifies ratios that areimportant to a companyâs profitability. Assume that the ratios areunfavorable. Recommend to management one (1) way in which it canimprove the companyâs profitability ratios.

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Bunny GreenfelderLv2

9 Jan 2019

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Prepare a report to management that identifies ratios that areimportant to a companyâs profitability. Assume that the ratios areunfavorable. Recommend to management one (1) way in which it canimprove the companyâs profitability ratios.

Assignment 2: You Are an InvestmentAnalyst
Due Week 10 and worth 250 points

As the CFO of your corporation, you are in charge of preparing andanalyzing financial statements that will be presented to potentialinvestors and creditors. However, before you can present thefinancial statements to investors and creditors, you need toprepare the financial statements with supporting analysis. Selectone (1) pair of the following companies to conduct your financialstatement analysis.

Pepsi versus Coca Cola, or

Amazon versus eBay

Target versus Walmart

Nike versus Reebok

Write a six to eight (6-8) page paper in which you:

1) Analyze each companyâs history, product / services, majorcustomers, major suppliers, and leadership, and provide a synopsisof each company.

2) Identify three (3) profitability ratios that creditors may beinterested in. Calculate the ratio for each company, and prepare areport to summarize your findings on the financial health of eachcompany. Also, recommend to management the manner in which they canimprove each of the three (3) ratios identified.

3) Summarize at least two (2) news events (this may includemergers, acquisitions, or political issues) that occurred from 2012to the present day, and analyze the impact that these events had oneach companyâs financial statements. Indicate the primary way inwhich the merger, acquisition or political issues influencepotential investorsâ and creditorsâ perception of bothcompanies.

4) Analyze each companyâs income statement over the past two (2)years, and determine which company outperformed the other. Suggesta way in which the lagging company can improve its income. Supportyour suggestion with a specific analysis.

5) Analyze each companyâs balance sheet. Prepare a verticalanalysis for each company, interpret the results, and write afinancial report. Also, suggest the manner in which the companythat is not performing well can improve its balance sheet in orderfor it to be attractive to potential investors.

6) Use at least four (4) quality academic resources in thisassignment. Note: Wikipedia and other Websites donot qualify as academic resources. PLEASE INCLUDE THE WEBSITES USEDFOR INFORMATION.

greymammoth322

According to the textbook, the balance sheet is important toinvestors and creditors because it provides important informationabout the amounts of investments, obligations to creditors, andownerâs equity. However, there are limitations to the balancesheet. Explain three (3) limitations of the balance sheet, andsuggest the fundamental manner in which a company can overcome eachsuch limitation. Provide a rationale for your suggestions.

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