UGBA 10 Chapter Notes - Chapter article: Urban Outfitters, Inditex, Asset Turnover

• School: Berkeley
• Department: Business Administration Undergraduate Program
• Course: UGBA 10
• Professor: Omar Romero-Hernandez

Document Summary

Analyzing financial statements: useful for making comparisons across companies, or in evaluating company performance over time, 5 public companies in article: The financial analysis framework: 3 key statements: Income statement - documents company"s financial activity over given accounting period (ex. A year: balance sheet - reflects company"s financial position, assets, liabilities, and shareholder equity as of a particular date (ex. End of financial year: statement of cash flow - cash flows over a given period, common to average beg. Indicator of company"s profitability relative to assets/total capital employed in firm. Indicates how efficiently management uses assets to generate earnings: roa = earnings / total assets, dupont framework decomposes roe to look deeper @ profit/loss. Net income / equity x total assets / equity x. Profitability: profitability = first component of roe decomposition profit margin company achieve from ea. If all assets financed by equity multiplier = 1.