FIN310P - Complete all 36 financial ratios for 2015 & 2016 on tab 2. Each calculation must...

FIN310P Chapter 2 Financial Ratio Assignment

Chapter 2 provides the fundamentals of financial statement analysis. This chapter is an

important building block for our course and your group Financial Analysis project.

Chapter 2 references a company called Global Corporation and provides their financial

statements throughout the chapter. The attached Excel document has all three financial

statements and the financial ratio equations necessary to evaluate Global’s financial situation.

The Attached Excel Document:

Tab 1: Student Investment Comments

Tab 2: Financial Ratio Equations

Tab 3: Balance Sheet

Tab 4: Income Statement

Tab 5: Statement of Cash Flows

Student Requirements:

1. Complete all 36 financial ratios for 2015 & 2016 on tab 2. Each calculation must be linked

back to the financial statements in the Excel document.

2. Explain what caused each ratio to change from 2015 to 2016 on tab 2.

3. Determine if each ratio change from 2015 to 2016 was a “good” or “bad” change for the

shareholders. i.e. did management maximize shareholder wealth?

4. Use your financial knowledge to answer the following question on tab 1. Would you invest in

this company? If so, why?