Income Statement Analysis

.     Income Statement

 

Referencing this week’s readings and lecture, address the following: 

o    What are the two causes of an increasing or decreasing sales number?

o    Discuss all the reasons that might explain an increase or decrease in gross profit.

Respond to at least two of your classmates posts.

2.     Analyzing an Income Statement

 

Income statements are presented in the table below for the Elf Corporation for the years ending December 31, 2010, 2009, and 2008. Write a one-paragraph analysis of Elf Corporation’s profit performance for the period.  Create a common-sized income statement for the three years. What conclusions can you draw from the different parts of the statement? What are the causes and effects of Elf’s performance for those three years?  



Elf Corporation Income Statements for the Years Ending December 31

(in millions) 2010 2009 2008
Sales $700 $650 $550
Cost of goods sold   350   325   275
Gross profit   350   325   275
Operating Expenses:      
Administrative   100   100   100
Advertising and marketing     50     75     75
Operating profit $200 $150 $100
Interest expense     70     50     30
Earnings before tax $130 $100 $  70
Tax expense (50%)     65     50     35
Net income $  65 $  50 $  35
 
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Financial Statement Analysis

Financial Statement Analysis

·         This week, you will select a company that you will do the analysis of.  Write at least a 200-word summary in which you identify the firm you have selected, summarize why you selected it, and explain the items a financial analyst might find useful within its annual report.  



Additionally, read the Forbes article,“12 Lessons from Warby Parker’s Annual Report,” and explain which of these 12 lessons may apply to your company selection.

 
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Principals Of Finance Case Study

Read the following 9 Mini Case. After complete questions A through D. Please provide at least three scholarly sources to support your answers. 

750 – 1,250 words, APA style, font size 12 and 1” margins.

Include cover page and reference page.

At least 80% of your paper must be original content/writing.

No more than 20% of your content/information may come from references.

Use at least three references from outside the course material; one reference must be from EBSCOhost

Mini Case

During the last few years, Jana Industries has been too constrained by the high cost of capital to make many capital investments. Recently, though, capital costs have been declining, and the company has decided to look seriously at a major expansion program proposed by the marketing department. Assume that you are an assistant to Leigh Jones, the financial vice president. Your first task is to estimate Jana’s cost of capital. Jones has provided you with the following data, which she believes may be relevant to your task:

  • The firm’s tax rate is 40%.
  • The current price of Jana’s 12% coupon, semiannual payment, noncallable bonds with 15 years remaining to maturity is $1,153.72. Jana does not use short-term interest-bearing debt on a permanent basis. New bonds would be privately placed with no flotation cost.
  • The current price of the firm’s 10%, $100 par value, quarterly dividend, perpetual preferred stock is $116.95. Jana would incur flotation costs equal to 5% of the proceeds on a new issue.
  • Jana’s common stock is currently selling at $50 per share. Its last dividend  was $3.12, and dividends are expected to grow at a constant rate of 5.8% in the foreseeable future. Jana’s beta is 1.2, the yield on T-bonds is 5.6%, and the market risk premium is estimated to be 6%. For the own-bond-yield-plus-judgmental-risk-premium approach, the firm uses a 3.2% risk premium.
  • Jana’s target capital structure is 30% long-term debt, 10% preferred stock, and 60% common equity.

To help you structure the task, Leigh Jones has asked you to answer the following questions.

  1. What sources of capital should be included when you estimate Jana’s weighted average cost of capital?
  2. Should the component costs be figured on a before-tax or an after-tax basis?
  3. Should the costs be historical (embedded) costs or new (marginal) costs?
  4. What is the market interest rate on Jana’s debt, and what is the component cost of this debt for WACC purposes?
    1. What is the firm’s cost of preferred stock?
    2. Jana’s preferred stock is riskier to investors than its debt, yet the preferred stock’s yield to investors is lower than the yield to maturity on the debt. Does this suggest that you have made a mistake? (Hint: Think about taxes.)
    3. What are the two primary ways companies raise common equity?
    4. Why is there a cost associated with reinvested earnings?
    5. Jana doesn’t plan to issue new shares of common stock. Using the CAPM approach, what is Jana’s estimated cost of equity?
 
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Analysis paragraph

After you write the public piece, you will write a detailed analysis paragraph, where you argue how you shifted your argument to fit your new audience and purpose. You should use specific evidence and analysis from your own writing to show this.

Your analysis paragraph should:

  1. Argue how you shifted your argument to fit your new audience and purpose.
  2. Include specific evidence from your own writing to show this.
  3. Offer analysis of your choices to show your topic sentence’s point.
  4. Follow the MEAL plan for paragraph organization.
  5. Read clearly with strong academic tone and style. 

Analysis paragraphs should range between 1/2-3/4 of a page in MLA format.  

 
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Principals Of Finance "Cash Flow; Financial Planning"

Two part assignment. Prompt 1 and Prompt 2.

Answer each beginning with the corresponding prompt number. 

Write at least 200 words for each prompt  • Identify the source of all information that you use 

Prompt #1 – Discuss the simplified procedures used to prepare and evaluate the pro forma income statement and the pro forma balance sheet. What ethical issues do you believe are present in these procedures and how does the SOX Act address these concerns? In your response, you should also discuss the judgmental approach.

Prompt #2 – Simplified approaches for preparing pro forma statements assume that the firm’s past financial condition is an accurate indicator of the future. There are several examples from the past where organizations were not accurately reporting their financial information. Discuss the relationship between the external auditor and the organization. What steps have been taken to ensure that the relationship is truly neutral and no bias is shown by the external auditing firm? 

 
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English

I have attached my old essays with the professor notes on my essays

Write a 3-4 page letter to the instructor, which includes your own analysis of your work in this class. 

You may discuss any of the following in this letter:

* Your strengths and weaknesses as a writer, and how these may have changed or your awareness of these may have been altered.

* The essay that you are most pleased with

* The essay that you are least pleased with

* The difficulty level of the various essays you completed for this class

* The format of this class

* The quality of lecture notes, instructor feedback on papers, and other materials

* The helpfulness of the textbook

* Your progress from Comp I to Comp II

Though this letter is to be addressed to the instructor, the real point of this paper is for you to reflect on this semester–how the course did (or did not) help you grow as a writer–and prepare yourself for other writing assignments you may have in the future.

Please be sure to review the Submit Your Assignment of Unit #7 section for specific instructions on how you should turn in your work for grading. The Final Letter to the Instructor is due at the end of Unit #7.

For your final paper in this class, you will be writing a 3-4 page letter to the instructor evaluating this course and your progress this semester.  You will want to use examples and explanation to justify your evaluation. 

Again, you may discuss any of the following in this letter:

*Your strengths and weaknesses as a writer, and how these may have changed or your awareness of these may have been altered.

*The essay that you are most pleased with

*The essay that you are least pleased with

*The difficulty level of the various essays you completed for this class

*The format of this class

*The quality of lecture notes, instructor feedback on papers, and other materials

*The helpfulness of the textbook

* Your progress from Comp I to Comp II

Please be sure to justify your evaluations of your own work and the course using specific examples whenever possible.

Here are some questions to keep in mind as you are revising your Final Letter to the Instructor:

* Is the overall focus of the letter clear in the first paragraph?  In other words, does the first paragraph make it clear what you’ll be discussing specifically?

* Are examples from your own essays (or the course materials) used to support your claims?

* Is the letter generally well-organized, and does it use transitions effectively?

* Is there a sense of closure (or completion) in the conclusion?

As with all of your other papers, please keep in mind that I’ll still be considering these basics as well:  purpose, focus, organization, tone, and editing.  

Sample Letter to the Instructor

 Dear Sheyene,

         The reason I took this class was simple: I needed it to graduate.  To be honest, I’d never liked writing much and didn’t expect to enjoy this experience.  However, it was much less painful than I feared and I did learn a great deal.  In this letter, I will be discussing what was most and least helpful in the course.  I will also discuss my own progress and what I got out of this class.

          The most helpful aspects of this course for me were the lecture notes and the instructor’s comments on each of my papers.  The lecture notes broke all of the concepts and assignments down into simple terms and steps that were easy to understand.  And you gave me great feedback on all of my papers, pointing out my strengths (which helped to build my self-confidence as a writer) and offering specific suggestions for further improvement. 

          The textbook was probably the least helpful thing for me, but then I’ve always found it hard to make myself actually read textbooks.  However, I must say that I really did appreciate the approach this course takes to the textbook:  The textbook is a tool.  Rather than reading the whole book (including a lot of stuff that wouldn’t apply to what we were doing), our reading assignments were very focused and always applied directly to the assignment we were working on.

          The assignments I enjoyed most were those in which I had total discretion in terms of my topic.  So the letter to the editor and the persuasive research paper were my favorites.  Perhaps, as a result, these were also my two strongest papers in the course. 

          In my letter to the editor, I discussed the problem of animal neglect and abandonment and proposed a solution, which I called GET TOUGH.  (This solution included several steps, but the real key to my solution involved using the community for outreach and involvement in ensuring animal rights).  As I work in an animal shelter, this issue hits very close to home to me.  Plus, it was easy to get all of the information that I needed to be specific.  My passion came through, and that heart-wrenching story about the basset hound we found in shock would have gotten to any reader.

          In my persuasive paper, I focused on the importance of spaying or neutering your pets.  This issue was, of course, very much connected with the topic of my letter to the editor.  Animal abuse and neglect would be greatly lessened if there weren’t so many unwanted puppies and kittens being born to people who can’t take care of them and don’t wish to do so.  I opened up the paper with a series of questions, which I think helped catch the readers’ attention.  And I had a great number of facts such as the current stats–local and nation–regarding unwanted pets and annual pet birth rates.

          My weakest paper was the summary and critical response.  I hated that article!  As a result, I fould it very difficult to remain objective in the summary, and I found it hard to keep myself from just going off on a rant against the author in the critical response.  I wanted to keep including words that gave away my position in the summary (such “As the author tries to argue . . ” or “The last point in her useless rant . . . “).  These were inappropriate, of course, so I had to edit them out. And, as I mentioned, in the critical response, I wanted to just talk about how much I disagreed rather than focusing on whether or not the article was successful as a piece of writing.

          According to our syllabus, this course is designed to teach us how to compose purposeful writing as well as the nature of argumentation, critical thinking, and persuasive writing in particular.  The course taught me all of those things, but it also taught me something else.  This course taught me that I can be a successful writer and that persuasive writing skills are going to continue to be important for me–in other classes, in my career, and in my personal life in my community.

          Words are, indeed, powerful tools.  Thanks for teaching me how to use them.

Sincerely,

John Banks

Formatting Basics:  In terms of formatting, 1-inch margins, 12-point Times New Roman font, and double-spacing are the basics that are generally preferred in academic writing.   It is also helpful to indent the first line of each new paragraph.  In terms of the program you use to save your work, Microsoft Word is preferred, but please just let me know if you have questions about other acceptable programs.

 
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Financial Ratios

  1. Financial Ratios

     

    what are the limitations of financial ratios?  Classify your answer into at least the following categories: liquidity ratios, activity ratios, leverage ratios, and profitability ratios. 
  1. Financial Analysis

     

    R.E.C. Inc.’s staff of accountants finished preparing the financial statements for 2010 and will meet next week with the company’s CEO as well as the Director of Investor Relations and representatives from the marketing and art departments to design the current year’s annual report.  Write a paragraph in which you present the main idea(s) you think the company should present to shareholders in the annual report.  Why do you think those ideas should be included?
 
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Managerial Finance

Part 1: Stockholders and Management Interests

Stockholders and managers want the same thing, don’t they? Theoretically, yes, but in reality, it does not always work that way. Too often, managers’ personal goals compete with shareholder wealth maximization. Sometimes, managers pay themselves excessive salaries or bonuses that are at odds with the idea of shareholder wealth maximization. How many times have you seen in the news examples of CEO excesses or outlandish spending on events or things that definitely do not help the overall goal of stockholder wealth maximization? 

To prepare for this Discussion, think about a time in your professional experience when a decision was made that seemed to benefit a specific manager or small group of managers and not the overall corporation. If you do not have professional experience directly related to this topic, research a situation in the news where this theme is demonstrated. Consider the outcomes of such an imbalance between manager and stockholder interests, and research on how to avoid such a situation.

Describe the situation from either your professional experience or your research.

Explain two or more motivational tools that can aid in aligning stockholder and management interests.

Explain how your selected tools are effective in resolving potential conflicts among managers and stockholders.

Support your discussion with appropriate academically reviewed articles. Use APA format throughout.

 
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Financial Management

Summary:

Professional Assignment 2 CLO 4Identify a current change in an organization with which you are familiar. Alternatively, identify a current public issue about which “something must be done.” In relation to the change issue, think about what sense-making changes might need to be enacted and how you would go about doing this. Assess this in terms of the eight elements of the sense-making framework suggested by Helms Mills and as set out in Table 9.7:

  1. • Identity construction
    • Social sense-making
    • Extracted cues
    • Ongoing sense-making 
  2. • Retrospection
    • Plausibility
  3. • Enactment
  4. • Projection
    What ones did you feel you might have the most/least control over? Why? What implications does this have for adopting a sense-making approach to organizational change?
    Prepare a 2 – 3 page document with your answers and thoughts in APA format.
    *Please refer to the Grading Criteria for Professional Assignments on page 9 of the syllabus for specific guidelines and expectations. 
 
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HR

Chapter 5

Imagine that you have been tasked with creating a training and development program for midlevel business managers in an organization (you can use your actual organization or one that you create). A midlevel manager is defined as a manager of managers. You have to present your proposed training program to your supervisor. To do this, you must decide on a training model, conduct a needs analysis, write learning objectives, and create the content of the training. For your assignment, you will create a 12- slide presentation (not counting the title and reference slides) that includes specific information as outlined below.

The topic of the training can be any subject relevant to a midlevel manager that we covered in the course, such as how to deliver real-time coaching feedback, how to communicate unfavorable news to employees (e.g., compensation status changes), or how to communicate that a complaint has been made against an employee concerning harassment.

  • Be sure to include the information below in your PowerPoint presentation.
  • Discuss your selected training process model, and describe why you recommend this model.
  • Explain the steps you would have taken to conduct a needs analysis.
  • State how this training links to the organizational objectives.
  • Provide a sample of two measurable course objectives (from input objectives through impact objectives).
  • Present one of the program’s completed modules. For example, this should be one or two of the objectives that inform or engage the participants in an activity.

Be sure to cite any sources used in a reference slide with proper APA style. In addition, a minimum of one academic source that was not used in the Unit III Lesson or listed in required reading must be used, cited, and referenced.  You may also use the slide notes function to explain slide contents as necessary, but this is not required.

 
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