Interpretation of financial statement Essay Example | Topics and Well Written Essays - 1000 words

Interpretation of financial statement - Essay Example 60% (2010) = (17,250,000) / 53,580,000 = 32.19% Debt to Equity Ratio Debt to Equity Ratio = Total Debt / Total Equity (2011) = (33,760,000) / 37,160,000 = 90.85% (2010) = (17,250,000) / 36,330,000 = 47.48% Interest Cover (TIE) Interest Cover = (Earnings before Interest and Taxes + Interest Expense) / Interest Expense (2011) = (12,920,000+ 2,000,000) / 2,000,000 = 7.46x (2010) = (16,905,000 + 1,700,000) / 1,700,000 = 10.94x Profitability Ratios Gross Profit Margin Gross Profit Margin = Gross Profit / Sales (2011) = 25,800,000 / 61,000,000 = 42.30% (2010) = 33,980,000 / 73,200,000 = 46.42% Operating Profit Margin Operating Profit Margin = Operating Profit / Sales (2011) = 14,920,000 / 61,000,000 = 24.46% (2010) = 18,605,000 / 73,200,000 = 25.42% Net Profit Margin Net Profit Margin = Net Profit / Sales (2011) = 7,320,000 / 61,000,000 = 12.00% (2010) = 9,578,000 / 73,200,000 = 13.08% Return on Assets Return on Assets = Net Profit / Total Assets (2011) = 7,320,000 / 70,920,000 = 10.32% (2 010) = 9,578,000 / 53,580,000 = 17.88% Return on Equity Return on Equity = Net Profit / Total Equity (2011) = 7,320,000 / 37,160,000 = 19.70% (2010) = 9,578,000 / 36,330,000 = 26.36% Return on Capital Employed (ROCE) Return on Capital Employed = (Earnings before Interest and Taxes/Capital Employed)* (2011) = 14,920,000/55,160,000 = 27.05% (2010) = 18,605,000/47,330,000 = 39.31% * Capital Employed = Total Assets – Current Liabilities MARKET RATIOS Earnings per Share Earnings per Share = Net Profit / (Average no. of Outstanding shares) (2011) = 7,320,000 / (20,000,000) = ?0.37 (2010) = 9,578,000 / (18,000,000) =?0.53 Book Value per Share Book Value per Share = Common Equity / (Average no. of Outstanding shares) (2011) = 37,160,000 / (20,000,000) = ?1.86 (2010) = 36,330,000/ (18,000,000) =... BLS Ltd., manufacturer and supplier of customized furniture and fittings in the UK construction market has expanded its operations in newer markets in recent times. The company’s performance improved significantly up till 2010 as the new management which took over in 1996 made strong decisions and adopted an approach based on quality and perseverance. However, analysis of the company’s financial ratios suggests that its financial performance has deteriorated considerably during the last year.Liquidity Ratios The current ratio of the company is just acceptable at 1.27. However this ratio has declined from 2.54 to 1.27. This is a worrying sign for the company as it implies that the company is just about covering its current assets with its current liabilities. In other words, the company is finding it much more difficult to meet its short term obligations now than a year ago (Besley et al. 2008). As a result, the working capital of the company has also decreased by a sign ificant margin. Consequently, BLS Ltd.’s liquidity position has also worsened. The decrease in Quick/Acid Test Ratio from 1.36 to 0.68 is also quite alarming. This ratio is obtained by removing inventories from the equation which are considered to be the least liquid of all assets. This ratio implies that the company is covering just around 68% of its liabilities. The chief reason for these changes is the increase in current liabilities by more than 100% as the company has expanded its activities.

Factors That Influence Consumers Purchasing Decision Essay

Factors That Influence Consumers Purchasing Decision - Essay Example The researcher states that a mind map has been developed in order to explain the various factors that are observed to largely influence the buying procedure of iPhone 5S. A group debate has also been conducted in order to analyze the aforesaid subject matter, i.e. the patterns of consumer behavior in the iPhone 5S market context. In relation to the findings obtained, it can be apparently observed that psychological, personal, social and situational factors impose strong influences on consumers’ purchasing decisions. Furthermore, the group debate revealed various internal along with external factors that play a distinctive role to determine the selection and purchase procedures of products and/or services as followed by consumers in the modern-day markets. Consumer behavior is described as the study of the activities that commonly involve searching, evaluating and purchasing of specific products or services followed by the customers in satisfying their respective requirements. This concept mainly concentrates on how people make decisions concerning the utilization of money, time and effort on consuming products and/or services. In other words, it can be affirmed that consumer buying behavior can be described as the activities with respect to acquisition, utilization, and disposition of products, services, thoughts, and experiences. In the field of marketing management, consumer behavior explains the reasons and logic that trigger purchasing decision and consumption pattern of the buyers. It elucidates the procedure by which, consumers make purchasing decisions. This definition clearly exhibits the idea that consumer behavior is a decision-making procedure, which begins in the mind of the customers and leads towards a set if short-listed substitute products or services that can be purchased or availed to suffice their requirements. Subsequently, understanding consumer behavior is important because it assists organizations to develop strategies and ensure s uccessful attainment of their marketing goals.