Analysis of Milavec Financial Statements .
Analysis of Milavec Financial Statements PART B
Review the Milavec Financial Statements (attached at the bottom of this assignment) and make some initial observations about the company.
Working through the Milavec Financial Statements 3 perspectives or points of view (POV)
1) Investors considering investing $100,000, who will purchase Preferred Stock
2) Lenders considering loaning $100,000 for a 5-10 year term
3) Internal Management tasked with increasing profits over 3 years by 5%
Purpose:
The purposes of this assignment are to introduce you to the concepts of financial statements analysis, to help you develop knowledge and skills associated with financial statement analysis, to provide a comprehensive example that can be used for application of previously learned concepts and skills, and to foster your collaboration and communication skills.
Skills: The assignment will help you develop and practice the following skills
Understand the components of the Income Statement and Balance Sheet
Analytical procedures for horizontal and vertical analysis
Calculate financial statement ratios for liquidity, solvency, profitability, and stock.
Compare and analyze the results for financial statement analysis computations.
Evaluate the results of financial statement analysis and produce a conclusion
Judge the results of financial statement analysis and select the best solution
Knowledge: The assignment will help you apply knowledge learned related to
Horizontal and vertical analysis
Ratio analysis for liquidity, solvency, profitability, and stock
Income Statement components of Revenue, Cost of Goods Sold, Gross Margin,
Operating Expenses, and Net Income
Balance Sheet components of Short-term Assets, Long-term Assets, Current
Liabilities, Long-term Liabilities, Retained Earnings, and Stockholders’ Equity
Limitations of Financial Statement Analysis
Evaluate the performance of a company named Milavec Company. We do not have a lot of details about the company’s operations, but we do have an Income Statement and Balance Sheet for years 3 and 4.
This link provides an example of and description of financial analysis. Scroll down to the section on Liquidity Ratios to see an example of a clear presentation followed by a brief description.
https://www.investopedia.com/articles/personal-finance/081815/invest-costco-first-understand-its-balance-sheet.asp
