I have Uploaded the excel formula sheet I had already completed. Use the Excel spreadsheet I had upload to complete assignment. I also uploaded the paper outline template. Also attached is prior assignment to help guide for this assignment.
Competencies
In this project, you will demonstrate your mastery of the following competencies:
- Analyze financial and investment decisions that add value to the organization
- Analyze financing options to maximize investor value
Scenario
You are a financial analyst for the chosen business that you selected during your Module Two Journal assignment. Your supervisor has discovered last minute that your business’s board of directors is looking for updates on the business’s financial health. Your supervisor has asked you to write a report regarding the business’s current financial health and the available financial options for improving the business. You’ve also been asked to make recommendations as to which options the business should choose to best support its financial health. Your supervisor will then use your report to present to the business’s board of directors, whose members all have varying levels of knowledge in terms of finance.
Directions
Using the business you chose from the Project Two Business Options List, create a report for your supervisor to share with the board of directors during their presentation. Keep in mind that your report needs to be easy for someone unfamiliar with finance to understand, as not all of the board members for your business fully understand finance.
Using Mergent Online, locate the most recent quarterly financial statements for your chosen company, and use these statements to support your analysis throughout the project. Refer to the Project Two Financial Assumptions document located in the Supporting Materials section for the assumptions you need in order to analyze the three available financial options outlined in the Financial Analysis section of the project directions.
You are encouraged to use the Project Two Financial Analyst Report template located in the What to Submit section to help complete this project.
Specifically, you must address the following:
- Financial Analysis: In this section of the report, you will use the most recent quarterly financial statements for your chosen business and the Project Two Financial Formulas spreadsheet (located in the What to Submit section) to calculate appropriate financial formulas for assessing the business’s financial health. You will also analyze all three available financial options for improving the business based on your calculations and the provided Project Two Financial Assumptions document.
- Financial Calculations: Calculate accurate financial formulas to assess the business’s current financial health. Specifically, you must calculate the following:
- Working capital
- Current ratio
- Debt ratio
- Earnings per share
- Price/earnings ratio
- Total asset turnover ratio
- Financial leverage
- Net profit margin
- Return on assets
- Return on equity
- Working Capital Management: Explain the impact of working capital management on the business’s operations. Provide examples to support your claims.
- Bond Investment: Analyze the risks and benefits of the business choosing to invest in a corporate bond, including the necessary ethical considerations, appropriate calculations, and examples to support your analysis.
- Capital Equipment: Analyze the risks and benefits of the business choosing to invest in capital equipment, including the necessary ethical considerations, appropriate calculations, and examples to support your analysis.
- Capital Lease: Analyze the risks and benefits of the business choosing to purchase a capital lease, including the necessary ethical considerations, appropriate calculations, and examples to support your analysis.
- Financial Calculations: Calculate accurate financial formulas to assess the business’s current financial health. Specifically, you must calculate the following:
- Financial Evaluation: In this section of the report, you will now determine if the three available financial options in the Project Two Financial Assumptions document are appropriate for the business, considering the analysis you did in the first section. You will also explain financing and describe the business’s likely future performance.
- Financing: Explain how a business finances its operations and expansion.
- Bond Investment: Assess the appropriateness of a bond investment as a financing option for the business’s financial health, using your financial analysis and other financial information to your support claims.
- Capital Equipment: Assess the appropriateness of a capital equipment investment as a financing option for the business’s financial health, using your financial analysis and other financial information to support your claims.
- Capital Lease: Assess the appropriateness of a capital lease purchase as a financing option for the business’s financial health, using your financial analysis and other financial information to support your claims.
- Short-Term Financing: Explain how potential short-term financing sources could help the business raise needed funds for improving its financial health. Base your response on the business’s current financial information.
- Future Financial Considerations: Describe the business’s likely future financial performance based on its current financial well-being and risk levels. Use financial information to support your claims.
- Financial Recommendations: In this section of the report, you will recommend which financing option(s) are the best for the business to choose depending on its financial health.
- Financial Recommendation(s): Recommend the most appropriate financing option(s) based on the business’s financial health, including a rationale for why the option(s) are best.
RATIOS
| ACCOUNTING & FINANCIAL RATIOS | |||||||||||||
| CURRENT RATIO (Current Assets / Current Liabilities) | TOTAL ASSET TURNOVER RATIO (Total Revenue / Total Assets) | ||||||||||||
| Current Assets | 339660 | Total Revenue | 170220 | ||||||||||
| Current Liabilities | 274130 | 1.2390471674 | Total Assets | 20222.1 | 8.4175234026 | ||||||||
| WORKING CAPITAL (Current Assets – Current Liabilities) | FINANCIAL LEVERAGE (Total Assets / Shareholder’s Equity) | ||||||||||||
| Current Assets | 339660 | Total Assets | 20222.1 | ||||||||||
| Current Liabilities | 274130 | 65530 | Shareholder’s Equity | 867410 | 0.0233131968 | ||||||||
| DEBT RATIO (Total Debt / Total Assets) | NET PROFIT MARGIN (Net Income / Total Revenue) | ||||||||||||
| Total Debt | -78370 | Net Income | 11230 | ||||||||||
| Total Assets | 2022210 | -0.0387546298 | Total Revenue | 170220 | 0.0659734461 | ||||||||
| EARNINGS PER SHARE (Net Income / Weighted Average Common Shares Outstanding) | RETURN ON ASSETS (Net Income / Total Assets) | ||||||||||||
| Net Income | 11230 | Net Income | 11230 | ||||||||||
| Shares Outstanding | 18180 | 0.6177117712 | Total Assets | 20222.1 | 0.5553330267 | ||||||||
| PRICE EARNINGS RATIO (Share Price (end of quarter / EPS) | RETURN ON EQUITY (Net Income – Preferred Dividends / Shareholder’s Equity) | ||||||||||||
| Stock Price | 551740 | NI – Pref. Div. | 9180 | ||||||||||
| EPS | 0.51 | 1081843.1372549 | Shareholder’s Equity | 867410 | 0.0105832305 | ||||||||
Monthly
| Time Value of Money – Monthly Compounding | |||||||||||||||
| Rate of Return | Year 1 | ||||||||||||||
| Initial Investment | Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | ||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 2 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 3 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 4 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 5 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 6 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 7 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 8 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 9 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Year 10 | |||||||||||||||
| Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |||
| Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
Annual
| Time Value of Money – Annual Compounding | |||||||||||||
| Rate of Return | Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | ||
| Initial Investment | Interest | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ||
| Investment Value | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |||
PV
| Time Value of Money – Present Value Annuity | |||
| Number of Years | |||
| Rate of Return | $0.00 | ||
| Payment | |||
FV
| Time Value of Money – Future Value Annuity | |||
| Number of Years | |||
| Rate of Return | $0.00 | ||
| Payment | |||
PV – Lump Sum
| Time Value of Money – Present Value of Lump Sum | |||
| Rate | |||
| Years | $0.00 | ||
| Initial Investment | |||
FV – Lump Sum
| Time Value of Money – Future Value of Lump Sum | |||
| Rate | |||
| Years | $0.00 | ||
| Initial Investment | |||
NPV
| Net Present Value (NPV) Calculator | |||||||||||||||||
| Building | |||||||||||||||||
| Initial Investment | Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | ||||||
| Annual Cash Inflows | Cash Flows | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ||||||
| Discount Rate | NPV = | $0 | Year | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | ||||
| Number of Years | Cash Flows | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ||||||
| Salvage Value | |||||||||||||||||
| Equipment | |||||||||||||||||
| Initial Investment | Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | ||||||
| Annual Cash Inflows | Cash Flows | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ||||||
| Discount Rate | NPV = | $0 | Year | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | ||||
| Number of Years | Cash Flows | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ||||||
| Salvage Value | |||||||||||||||||
| Bonds | |||||||||||||||||
| Initial Investment | |||||||||||||||||
| Annual Cash Inflows | |||||||||||||||||
| Discount Rate | NPV = | $0 | Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | ||||
| Number of Years | Cash Flows | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ||||||
| Principal Returned | |||||||||||||||||
Running Head: Financial review for Disney Corporation 1
Financial review for Disney Corporation 2
Financial review for Disney Corporation
Name
Institution Affiliation
Introduction
Financial review can be described as a fundamental aspect applied in determining long-term sustainability pentagram. This process is characterized by profound in-depth analysis of the information presented in financial statements of business entities to provide skeptical judgment applied to evaluate short-term and long-term durable competitive advantage. According to the information provided by (Guerard, 2013) Disney Inc.Com is a world class film, theme park resort, television shows and business entity which offer entertainment content intended for children and families. Over the recent past, this entity has been highlighted to have intensified its populism leading to heighted profitability yield.
Disney Inc.Com can be described to be a faultless case scenario based on its precise operational pentagram that is undergoing significant modification in terms of organizational structure, quality product production, market investment portfolio, organizational ethnicity and radical update of its advertisement and customer outreach measures based on postulated customer competitive pressure. This is a business that nurtured extremely fast within a little time span. Thus, its management found themselves not being able to cling to their procedures and finances under control. However, the Disney Inc.Com almost faced insolvency. Therefore, the company had to re-evaluate and restructure its organizational principles and organizational configuration to avoid bankruptcy. The organizational culture embraces change; with the motive to outperform and be successful as its fundamental objectives (Dyer, Furr, & Lefrandt, 2019), acknowledges.
Financial statement analysis
Review of financial statement can be described as a fundamental aspect in determining the certainty of short-term and long-term operability pentagram. Consequently, critical scrutiny of financial review is also a significant step in healthcare vender as it aids in planning and determining the going concern concept based on the estimated profitable yield earned from patients. Going concern is the ability of Disney Inc.Com to sustain its operating in the future despite of the stiff competition which emerges in the market amongst other systematic and unsystematic risk occurrences. The information provided by (Davidson, 2018), provides further insight on financial review as the process of determining potential credit risk based on financial rationales.
This process of financial reviewing provides decisive information to investors, shareholders, owners, general public and the government as it aids in determining whether the business venture has the financial ability to meet the expected financial obligations on short run and long run basis. However, in terms of planning and expansion, the financial statement review based on the information provided in the spreadsheet analysis aid in drafting the leeway of generating more capital and minimize expenditures based on financial forecasting heightened through ratio analysis.
Graphical representations of Balance sheet for the year end 2020
Graphical representations of Balance sheet for the year end 2019
According to the information presented in the entities balance sheet computed on the basis of quantum strategy, the total assets have been indicated to maintain a positive growth variant from the financial year ending 2019 to the financial year ending on 2020. In addition, the total expected liability has been represented with a linear incline over the respective financial period indicating enhanced increase on debt rate. Debt increase can be classified as a negative variant based on long-term performance portfolio. Shareholders’ equity have been characterized by augmented positive growth over the respective financial period indicating a favorable operating margin based on short-term and long-term factor evaluation matrix.
Cash flow statement graphical representation for the year end 2020
Cash flow statement graphical representation for the year end 2019
Cash flow statement can be described as the fundamental breakdown of the entities cash flow from operating activities, net cash flow from investing activities and net cash flow generated from financing activities. A well-defined decision making criterion is required while computing cash & cash equivalents based on the respective operational timeline to facilitate sustainable going concern. The information presented in (Macro trends, 2021) indicates the existence of a distinct performance benchmark regarding cash flow from operating activities due to linear increase in growth over the last quantum financial periods. Concurringly, net cash flow from investing activities has increased since the financial year ending 2019 from $ 5,984 to $ 7,616 in the financial year ending 2020 a clear indication that Disney Inc.Com has heighted the investment portfolio in terms of long-term operational pentagram. The expected net cash flow from financing activities can be described to have also a favorable growth factor over the respective financial period having an increased positive factor from ($15,096) in the financial year 2019 to ($3,850) in the financial year ending 2020. This can be described to have a negative profitability impact on short-term performance pentagram and projected to have a positive long-term profitability impact on Disney Inc.Com investment portfolio chart, (Guerard, 2013).
Income statement graphical representation for the year end 2020
Income statement graphical representation for the year end 2019
Income statement can be described as a critical representation of the entities revenue growth compared to the expected operational expenses and income taxes. According to the information presented in (Macro trends, 2021), the expected to cost of revue has been highlighted to have unfavorable negative growth rate over the respective period from the financial year 2019 with $ 69,607 to the financial year ending 2020 with $ 65,388. This indicates a favorable going concern concept and certain operability pentagram. The expected net income has also been indicated to have unfavorable growth proportion over this respective financial period from $11,054 in the financial year 2019 to $ (2,864) in the financial year ending 2020.
Financial ratio analysis
A profound efficiency analysis of Disney Inc.Com financial health is enhanced through horizontal presentation of rationale which includes liquidity ratios, profitability ratio, efficiency ratio, long-term solvency ratio and financial leverage ratios.
Profitability ratio which have been used to provide relevant insight on Disney Inc.Com financial strength include return on assets and return on equity. Based on (Guerard, 2013), profitability ratios highlight the ability of Disney Inc.Com to be able to generate profit despite of the expected financial expenditures and risk uncertainties. A negative variant portrayed by return on asset and return on equity which is less than 1 indicates unfavorable financial health based on short-term financial operability pentagram.
Liquidity ratios can be describes the ability of Disney Inc.Com to meet its financial obligations and margin of long-term operability safety based on the available inventories. Precisely, quick ratio and the day’s sales outstanding have been computed to provide further insight on the debt coverage portfolio. Having a quick ratio of 1,308.61 in the financial year ending 2019 and (1,308.61) in the financial year ending 2020 is a clear indication that Disney Inc.Com has uncertain long-term debt coverage. Day’s sales outstanding have been computed to provide a detailed analysis of short-term payment range of debt. Having represented with this rationale which is greater than 1; it is a clear indication that the organization is unable to meet its short term obligations.
Financial leverage ratios which have been applied to enhance a profound financial analysis of Disney Inc.Com include current ratio and time interest earned ratio. A positive favorable operational pentagram has been highlighted by the arithmetic computation of these proportions. Consequently, efficiency ratios have also been considered to highlight the effectiveness of Disney Inc.Com operational pentagram. This included the accounts receivable turnover ratio and the asset turnover ratio based on the expected total sales. Long-term solvency of Disney Inc.Com has also been indicated to be certain based on debt to equity ratio and debt to asset ratio. Long term solvency is based on the total expected debts to be incurred compared to the entities equity and total assets. Having a debt to equity ratio of 1.076 for the financial year 2019 and debt to asset ratio of 1.28 in the same quarter is a clear indication that Disney Inc.Com has a certain long-term solvency rationale.
Conclusion
In summary, relevant application of internal factor evaluation matrix postulate effective integration of relevant analysis of financial performance of business entities. Disney Inc.Com has been highlighted to have a certain going concern despite of the increased competitive pressure and change in customer preference. A well-integrated supply chain management, application of quantum strategy and enhanced risk analysis portfolio has been indicated to be some of the key phenomenal which have enhanced profit maximization (Dyer, Furr, & Lefrandt, 2019).
Reference list
Dyer, J., Furr, N. R., & Lefrandt, C. T. (2019). Innovation capital: How to compete–and win–like the world’s most innovative leaders.
Davidson, W. N. (2018). Financial forecasting and decision making Place of publication not identified: JOHN WILEY.
Guerard, J. (2013). Introduction to financial forecasting in investment analysis New York, NY: Springer.
Macro trends, (2021). Disney Inc.Com – Stock Price History 2005-2021. Retrieved on 18th October 2021 From https://www.macrotrends.net/stocks/charts/DIS/disney/financial-statements
Cash flow from operating activites Cash Flow From Investing Activities Cash Flow from financial activities Net Cash Flow 5984 -15096 -464 1300
Revenue gross profit operating Income Pre-tax Income Income taxes Income After taxes EBITDA 65388 21508 -1941 -1743 699 -2442 8357
Revenue gross profit operating Income Pre-tax Income Income taxes Income After taxes Net Income EBITDA 69607 27546 10647 13923 3026 10897 11054 14814
Total current assets Total assets Total current liabilities Total liabilities Share holder Equity Total Liabilities and Share Holders Equity 35251 201549 26628 113286 88263 201549
Total current assets Total assets Total current liabilities Total liabilities Share holder Equity Total Liabilities and Share Holders Equity 28124 193984 3134 1 100095 93889 193984
Cash flow from operating activites Cash Flow From Investing Activities Cash Flow from financial activities Net Cash Flow 5984 -15096 -464 1300
FIN 320 Project Two Financial Analyst Report
[Note: To complete this template, replace the bracketed text with your own content. Remove this note before you submit your report.]
Financial Analysis, Financial Evaluation, and Financial Recommendation(s)
Financial Calculations:
Using the most current quarter’s financial statements for your chosen business and the
Financial Formulas spreadsheet, calculate the financial formulas below to assess the
business’s financial health.
Working capital:
[Write the result of the calculation and what it says about the company’s health.]
Current ratio:
[Write the result of the calculation and what it says about the company’s health.]
Debt ratio:
[Write the result of the calculation and what it says about the company’s health.]
Earnings per share:
[Write the result of the calculation and what it says about the company’s health.]
Price/earnings ratio:
[Write the result of the calculation and what it says about the company’s health.]
Total asset turnover ratio:
[Write the result of the calculation and what it says about the company’s health.]
Financial leverage:
[Write the result of the calculation and what it says about the company’s health.]
Net profit margin:
[Write the result of the calculation and what it says about the company’s health.]
Return on assets:
[Write the result of the calculation and what it says about the company’s health.]
Return on equity:
[Write the result of the calculation and what it says about the company’s health.]
Working Capital Management:
[In one paragraph, explain the impact of working capital management on the business’s operations. Provide examples to support your claims.]
Bond Investment:
[In one paragraph, analyze the risks and benefits of the business choosing to invest in a
corporate bond, including the necessary ethical considerations, appropriate calculations, and examples to support your analysis.]
Capital Equipment:
[In one paragraph, analyze the risks and benefits of the business choosing to invest in capital equipment, including the necessary ethical considerations, appropriate calculations, and examples to support your analysis.]
Capital Lease:
[In one paragraph, analyze the risks and benefits of the business choosing to purchase a capital lease, including the necessary ethical considerations, appropriate calculations, and examples to support your analysis.]
Financial Evaluation
In this section of the report, you will evaluate the three available financial options for the business and recommend which option(s) are the best for the business to choose.
1. Financing:
[In one paragraph, explain how a business finances its operations and expansion.]
Bond Investment:
[In one paragraph, write your assessment on the appropriateness of a bond investment as an option for the business’s financial health, using your financial analysis and other financial information to support your claims.]
Capital Equipment:
[In one paragraph, write your assessment on the appropriateness of a capital equipment investment as an option for the business’s financial health, using your financial analysis and other financial information to support your claims.]
Capital Lease:
[In one paragraph, write your assessment on the appropriateness of a capital lease purchase as an investment option for the business’s financial health, using your financial analysis and other financial information to support your claims.]
Short-Term Financing:
[In one paragraph, explain how potential short-term financing sources could help the business raise needed funds for improving its financial health. Base your response on the business’s current financial information.]
Future Financial Considerations:
[In one paragraph, describe the business’s likely future financial performance based on its current financial well-being and risk level. Use financial information to support your claims.]
Financial Recommendation(s)
[In 1 to 2 paragraphs, recommend the most appropriate financing option(s) based on the business’s financial health, and include a rationale for why the option(s) are the best.]
3
