CHAPTER 8. Analysis of Financial Statements. Topics in Chapter. Ratio analysis Du Pont system Effects of improving ratios Limitations of ratio analysis Qualitative factors. Income Statement. Balance Sheets: Assets. Balance Sheets: Liabilities & Equity. Other Data.
Analysis of Financial Statements
Average sales per day
= 45.5 days.
Sales/365DSO: average number of days from sale until cash received.
Debt ratio =
= = 43.8%.
$1,040 + $500
= = 6.3.
$80Calculate the debt, TIE, and EBITDA coverage ratios.
EPS = = = $1.01.
P/E = = = 12.
Price per share
$1.01Calculate and appraise theP/E, P/CF, and M/B ratios.
( )( )( ) = ROE