1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Aleksandr [31]
3 years ago
14

You are a professional financial analyst that is employed to help evaluate possible merger and acquisition candidates. You have

already reviewed the numbers, and the company seems solid on paper. You are unable to make a visit to the company yourself and are instead sending one of your direct reports to conduct the visit on your behalf. This is his first site visit, and he wants to review the work you have already done to familiarize himself with the company and asks for advice on things to look for. You offer to give advice on ways to find out if the company is "cooking its books" and what to look for when you conduct a "smell test."
What financial ratios should he be looking at and what do they tell you?
Business
1 answer:
kipiarov [429]3 years ago
4 0

Answer:

Explanation:

Below are some of the financial ratios he should consider:

a) Financial leverage ratios: This is used to measure the company earnings to service debt payments.

b) Return on investment: This is the ratio that is used to evaluate the profitability of the firm and the profit that is available to the stakeholders after all payments have been made.

c) Price to Earnings Ratio: This is an indicator of the price of the company's stock concerning the earnings per share. It is used to analyze if the stock price is over-priced or under-priced.

You might be interested in
EcoSacks manufactures cloth shopping bags. The controller is preparing a budget for the coming year and asks for your assistance
Sidana [21]

Answer:

ECOSACKS

Production  Budget

Sales                               540,000

closing inventory(FG)   <u>  210,000</u>

                                        750,000

Opening Inventory(FG)  <u>( 120,000)</u>

Production                         <u>630,000</u>

<u />

<u>Materials Purchase budget </u>

                                          cotton                    canvas

                                              yards                   yards

Material usage                 <u>630,000</u>                  <u>126,000</u>

Material purchase cost    $2,520,000            $1,512,000

                                 <u>      Labor Budget </u>

labor hour(630,000*0.5)         <u> 315,000</u>

Labour cost (315,000*18)       <u>$5,670,000</u>

<u />

<u>                                        Overhead budget</u>

Production unit                                630,000

Overhead cost ( 630,000*$3.40)      <u>$2,142,000</u>

Explanation:

8 0
3 years ago
Read 2 more answers
A car dealership performs a credit check on a potential customer. according to the credit bureau, the customer's credit score is
Nikitich [7]
A 710 credit score is considered good. People with this credit score are likely to be approved for credit cards and loans with average interest rates and terms.
5 0
3 years ago
Company purchased $60,000 of Stanton Company’s 12% bonds at 100 plus accrued interest of $2,400. On June 30, Pierce received its
ASHA 777 [7]

Answer:

d. $51,500

Explanation:

Proceed from sale of the bonds

face value x quote

50,000 x 103/100 = 51,500

The company will recognize a gain from the sale of 1,500 dollars as it sold  the investment for 51,500 while it was valued at 50,000 in their books

5 0
3 years ago
Gina changes the amount of milk she purchases depending on whether it costs $1,$1.50, or $1.75 a pound. What other information d
Illusion [34]

Answer: how much butter she buys at each price point.

Explanation: The demand curve shows how much a person chooses to buy at different prices. In order to graph the curve, we need to know how much butter Jenna buys when it costs $1, $1.50, and $1.75.

3 0
3 years ago
I'm selling candy and need tips.
krok68 [10]
I would love to help you! I will talk to you in a PM. Talk to you then : )
4 0
3 years ago
Other questions:
  • As a PR practitioner, imagine you work for a large corporation that has recently launched a new product that has not lived up to
    11·1 answer
  • A firm's _____ resources are also known as labor. economic human intangible financial natural
    13·1 answer
  • The Callie Company has provided the following information: Operating expenses were $244,000; Cost of goods sold was $378,000; Ne
    6·1 answer
  • Service businesses employ approximately ___ percent of the u.s. work force.
    12·1 answer
  • Assume the auto market is initially in equilibrium with imports from Japan taking up a significant share of the market. Now assu
    11·1 answer
  • You are given the following information for Bowie Pizza Co.: Sales = $64,000; Costs = $30,700; Addition to retained earnings = $
    15·1 answer
  • An uncle executed a warranty deed granting a parcel of land to his nephew. The uncle placed the deed in his bedroom closet and t
    8·1 answer
  • Life, Inc. experienced the following events in Year 1, its first year of operation: Performed counseling services for $31,600 ca
    15·1 answer
  • 3. Why is bell work an important part of the learning process?
    13·1 answer
  • Suppose a monopoly firm produces bicycles and can sell 10 bicycles per month at a price of $700 per bicycle. In order to increas
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!