Financial Statment for Wal-Mart Stores Inc.

To consider this we need cost of goods sold; beginning and ending inventory. The higher the ratio or lower average days in inventory suggest that management is reducing the amount of inventory on relative to sales.

These ratios will help us see how effective a company is at using their sales or assets and turning this into income.

The inventory turnover ratio "measures the number of times on average the inventory sold during the period; computed by dividing cost of goods sold by the average inventory during the period" (Kimmel et al, 2007, p. 292). This indicates how quickly a company sells its goods and a high ratio "suggests that management is reducing the amount of inventory on hand, relative to sales" (Kimmel et al, 2007, p. 287).

this ration is: Rate of Return on Net Sales equals Net Income divided by Net Sales. A high or

Rate of return on common stockholders’ equity: This ratio determines how much profit the company makes from the money invested by the shareholders. Investors will use this ratio to determine if the company is profitable over

A review of a company’s profitability lets investors or managers know how efficiently a company is operating. There are three key ratios to review. The profit margin, return on equity and return on assets. The profit margin is the net income divided by sales. The higher the profit margins the better. The return on equity is net income divided by total equity (Cornett, Adair & Nofsinger, 2009).. This can help to determine the amount of financial leverage the company is using. The return on assets is the net income divided by total assets. This can also help determine the financial leverage the company is using in regards to its assets (Cornett, Adair & Nofsinger,

These ratios are used to measure companies’ operating cycle.() Firstly in 2012, the receivables turnover for Oroton and Country Road are 54.86 times per year and 93.02 times per year. This indicates that Country road can collect cash from their customer faster than Oroton. Secondly, the payables turnover for Oroton and Country Road are 12.15 and 8.44 times per years. And it would be easier to analyze day payables which Oroton’s is 30 days and Country road’s is 43 days. This ratio shows that Country road has longer credit term to pay their suppliers than Oroton. Finally, the inventories turnover for Oroton and Country Road are 54.86 and 93.02 times per year. It is obvious that Oroton takes longer time to sell all of their inventories than country road. All of these ratios indicate that Country road has shorter operating cycle than Oroton. Therefore, they tend to have higher performance in terms of liquidity because they can generate cash faster.

The next three ratios to be examined are considered profitability ratios, figures which show the company’s ability to make “investment and financing decisions” or “how effectively a firm’s management is generating profits on sales, total assets, and, most importantly, stockholders’ investment”, (Moyer, et al., 2007).

Starbucks reported their total liabilities as $2,703.6M and the shareholder equity as $3.674.7M in 2010. Using these numbers one can show a ratio of .736; this number should be low and under “1” so this number is an attractive ratio. Starbucks reported their total liabilities as $2,519.9M and shareholder equity as $3,045.7 in 2009. Using these numbers the company can show a ratio

Another ratio I would select for this facility would be the days receivables. The reason I would chose this type of ratio is that it is a good representative of net receivables for a particular # of days.

Firstly, the current ratio is used to determine the short-term to pay its maturing obligation and to have unexpected needs for cash. The current ratio’s formular is, current assets divided by current liabilities. According to Target 10-K Annual Financial Statement report, people

The second ratio represents the fraction of EBIT (i.e., operating profit) that the firm keeps after financing

It measures the utilization of assets in generation of net income. The ratio for Oracle stood at 9.9% as compares to 7.0% of Microsoft. It indicates a

Asset utilization ratios measure how quickly a company is able to turn over their receivables, inventory, and other assets. The faster the company is able to turn over their assets, the more efficiently the company is running because they

The days in inventory can give a lot information and can show the ratio of the numbers that is need to know on how many days that inventory has had to be held in warehouse, before been ship to stores, purchase by customers. The receivable can be compared to the business sales track activity and then can show the ratio. These is call the average collection period or the days sales outstanding. The comparison can be used to indicate these periods to show when customers are going to pay off their dues that company needs. Now, when it comes to low ratio indicates can show better outcome. These can imply that customers are purchasing more inventory within shorter period. The high statistic can imply that customers could buy more of the inventory, switch can hold inventory for longer