Financial Statement Analysis Worksheet, business and finance homework help

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One of the important objectives for this course is to prepare students to be managers and how to be rewarded or reward others based on performance. How can a manager determine if his or her employees are performing well or not? How can a manager determine which department needs help or is doing a great job? As a manager, how can you determine who will pay back their loans? As a manager, how can you determine which company to invest in in comparison to its market or the economy? As a manager, how can you determine the riskiness of an investment? Financial ratios help managers answer all the essential questions above; financial analysis helps managers to find, evaluate, and explain financial data to assist them in making decisions that impact the financial stability and future growth of their company. This type of analysis is used for external and internal purposes. One of the most important sources for effective and productive financial analysis is using data issued by the company itself. This includes the income statement, balance sheet, and statement of cash flow. Other important resources can also be used, such as prices of stocks. In this module, we will learn how to use, interpret, and understand these ratios that help us assess the financial stability of any company and give us insight on the best steps moving forward. Should we increase assets? Decrease liabilities? How can we increase profitability? This module will help answer these and many other questions that are always important for our jobs and our personal investment decision-making process. In our daily lives, we are always faced with decisions regarding investments, what the safest place is for them, and how to determine the risk associated with our investment. This module will educate us about the two most important tools we need to perform and understand financial analysis: Module Two

1. Ratio analysis: This helps us assess various items in the financial statements and how they relate to each other; with these ratios, we can measure the firm’s performance.

2. Cash flow analysis: This helps us evaluate liquidity and how operations are managed, how the firm is investing its cash, and the financial activities that relate to cash flows (for example, sales, building a new plant, buying new equipment). After learning these tools, we will be able to assess the level of risk associated with our investments. For example, if you chose to invest in Company X, why did you choose this company? Why this market? Why not Company Z? Why not a different market?