Economical Research Paper

 Financial Analysis Paper

п»їDate: Sunday, March 27, 2013

To: Andrew Foertsch

Coming from: Michael Torres

Subject matter: Financial Assertion Analysis of Ford (2011-2012)

Kia Motor Organization (Ford) can be an American multinational auto firm founded by Henry Honda. The company owns both Ford and Lincoln branded extravagance cars, generally selling Kia automobiles and commercial automobiles. It has a a comprehensive portfolio of products covering cars, vehicles, and power vehicles. Kia is group controlled by the Kia family and listed on the New York Stock Exchange (NYSE: F) here is info a general and brief research of Ford Company's financial performance in 2011 and 2012. More specifically, we'll analyze all of the changes of data via balance bedding and income statements between your years 2011 to 2012 and incorporate the research to obtain the overall conclusion of why the data will alter and is it good or bad. Although all businesses experienced the economic recession that began in 2008 which usually had a lot of effect upon the operations of Ford, it would not affect the report to compare the ratio difference of 2011 and 2012. Therefore , we all did not count number 2008 economic downturn as one of the reason that makes a difference between ford's economic performances between the two of these years. This is actually the table of some significant ratios to get 2011 and 2012: Table

Salary Statement

2011

2012

Total Revenue

$136, 264

$134, 252

Cost of Sales

$113, 345

$112, 578

Advertising, Administrative, Etc .

$11, 578

$12, 182

Financial Services

$3, 614

$3, 115

Total Cost and Expenses

$128, 504

$127, 961

Cash flow Before Income Taxes

$7, 720

$8, 681

Net Income

$5, 664

$20, 222

Desk

Value Ratio:

12. 89%

Total Liabilities:

12. 83%

Earnings Margin:

5. 20%

Net Incomes:

13. 80%

ROI

9. 70%

Net Income After Tax:

twenty-three. 10%

Inventory Turnover

0. 182%

Collateral Sales:

0. 231%

Acid-Test Ratio:

$0. 95

Products on hand:

$0. ninety-seven

Current Percentage:

$0. 84

Current Property:

$0. eighty six

Let's look at those data's at an total level. Almost all of the ratios gone up aside from Equity Rate. This is a leverage ratio which procedures the degree that a firm relies upon borrowed money in its operation. It is calculated by " total liabilities” divided simply by " collateral ratio”, any kind of figure previously mentioned 100 percent reveals a firm has more debt than equity. Because the " debts to owner's equity” rate of the two years is lower than completely, it implies that lenders and investors may well perceive Honda has enough equity to meet the short- term small business, so decrease the number, the better. Also, as a large element of owner's equity faces downgrading, the methodical write-off of the cost of touchable assets above its believed useful life over time, particularly in an automobile organization, this indicates Ford owned even more properties (tangible goods) this year than it has in 2011. From your overview info, we can see Kia kept improving each of the percentages in a low pace. The fastest the first is " come back on equity”, or we could call it return on investment, which problems Ford's current and potential investors, indirectly measures risk by telling us simply how much a firm gained for each buck invested by its owner, or, for any public company like ford, the stockholders. The higher the figure, the better. and figure above 15 percent is considered a reasonable return. In cases like this, because the ROI increased via 9% to 23%, the dividends distributed to stakeholders increased significantly, therefore Ford would be very attractive for potential traders and comfortable to keep old buyers. WE developed a challenge when WE saw the ROI (return on the user's equity) this summer was just about 9% each of our question is why a powerful and comparatively steady company a new lower than normal ROI in 2010. Then WE did some research and found out that Ford offers sold vehicles under a volume of other marques (brand names) during it is history. The Mercury company was presented by Ford in 1939, continuing in production till 2011, once poor revenue led to it is discontinuation. Therefore , it could be an issue led to poor financial condition. Yet Ford...

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