Final Financial Analysis

Accounting is the way all companies keep track of their out-going and in-coming finances. Applying accounting principles in any business is incredibly important because it allows for the least amount of mistakes and gives a comprehensive view of all transactions. There are many tools used in accounting, each with it’s own unique function. Statements are used to show a specific time period’s overview of assets, liabilities, and all transactions. These statements allow for easier comparing of months, years, or even different companies accounts. Two of the tools of financial statement analysis are called vertical analysis and horizontal analysis. Much like the definitions of vertical and

The solvency ratio is the ability for a company to repay debts shown in a percentage. The ratio shows if a business can meet goals of a long term loan by calculating the current and long term liabilities divided by net profit after taxes plus depreciation. In years one through four the

A horizontal analysis can be defined as “the study of percentage changes in comparative statements” (Charles T. Horngren, 2008, p. 746). It is useful in determining a company’s financial stability. This section will analyze Competition Bikes Incorporated’s (CBI) percentage changes from years 6 to 7 and then 7 to 8. The report will include an analysis of CBI’s comparative income statement and balance sheet.

In order for a company to be financially healthy, it is of most importance that the company must analyze, interpret, and review the business’s annual financial reports. The financial analyses of the annual reports provide insights and information regarding the performances of the business. In this paper, I will be disclosing financial evaluations and comparisons between Coca-Coca and PepsiCo Incorporation. The visualizations used in this paper were designed to provide the analyses performed utilizing three financial analyses methods: vertical analysis, horizontal analysis, and ratios analysis. There will also be recommendations made on how Coke and Pepsi could improve their financial status.

  The money statements is used by both external and internal users including investors, creditors, managers, and executives staff. There are several analysis that are used in many ways of Horizontal Analysis and Vertical Analysis. Horizontal Vertical compares in specific items over number of accounting period that many people uses to balance their information. There are compared in different ways of in Absolute Dollars and by percentage ratios that helps with calculations. Then the Vertical Analysis which compares each separate figure that shows in Financial statements. The explanation of the analysis through income statements and using the balance sheet The analyze information helps many businesses and owners to make good business decisions so understanding the analysis will be great importance to how people compares the analysis.

The non-favorable variance could have resulted due to poorly budgeted and/or poor supervision during the production process.

When obtaining the liquidity ratio for PepsiCo I took the current assets of 2004, $8,639.00, and divided them by 2004’s current liabilities, $6,752.00. After dividing the two numbers the current ratio was 1.27:1. I followed with the 2005 year and divided the current assets by the current liabilities, $10,454.00 divided by $9,406.00, the current ratio for 2005 was 1.11:1. After finding the PepsiCo liquidity ratio I moved on to find Coca-Cola’s liquidity ratio in order to compare the two. By following the same formula I found the 2004 current assets, $12,281.00, and divided them by the current liabilities, $11,133.00, finding the ratio for 2004 to be 1.10:1. When looking for the 2005 liability ratio I took the 2005 current assets, $10,250.00, and divided

The analysis of a company's financial statements helps in the determination of both the weaknesses and strengths of the concerned entity. Further, such an analysis helps in the determination of the future viability of firms. There are a wide range of techniques utilized in the analysis of financial statements. In that regard, it is important to note that the relevance of a horizontal, vertical as well as ratio analysis of a company's financial statements cannot be overstated. This is more so the case when it comes to the interpretation of the various dollar amounts presented in both the balance sheet and the income statement. In this text, I carry out a horizontal, vertical as well as ratio analysis of both The Coca-Cola Company and PepsiCo, Inc. The analysis' results will be critical in the evaluation of each company's performance. Findings will be used as a basis for recommendations on how each company can improve its financial status.

Commutronics had not accumulated enough profits and had no sufficient capital reserves. The company’s registered capital was therefore very low. The withholding tax rate of

DQ3: Horizontal and vertical analyses are analytical tools frequently used to analyze financial statements. What type of information or insights can be obtained by using these two techniques?  Explain how the output of horizontal analysis and vertical analysis can be compared to industry averages and/or competitive companies.

All managers need to understand where value comes from in their firm. The purpose of this analysis is to identify the financial strategy and performance of this particular publicly traded company. The process of understanding the risk and profitability of a company by analyzing reported financial info, especially annual and quarterly reports are vital to identifying the company’s overall financial performance. I wanted to analyze Coca Cola because the company has so much history and is one of the most recognizable brands in the world. I have always enjoyed researching food and beverage companies

Accounting helps to measure an organizations activities, process data into reports, and translate the results to decision makers. Financial statements and reports help to present the company to the public in financial terms. The information on these data statements can used to evaluate the company through vertical and horizontal analysis. Vertical analysis is the proportional analysis of a financial statement. Normally, vertical analysis is done with a financial statement over a period of time. When using vertical analysis, a line item on a financial statement is listed as a percentage of another item (Harrison, 2015). A horizontal analysis is the comparison of information or ratios over a series of reporting periods. Horizontal analysis helps investors and analysts to control how a company has grown over time. Analysts and investors could use horizontal analysis to compare a company's growth rates in relation to its competitors and industry.

Another solvency ratio that measures a company’s ability to survive over a long period is the long-term debt to networking capital ratio. In this formula one subtracts current liabilities from current assets and then the total is divided by the total by long-term debt obligations. This formula provides insight into an organization’s ability to pay back long-term debt and interest. According to numbers from Appendix B Coca-Cola’s ability to pay

Horizontal analysis is the comparison of a company’s historical financial information over a specific period of time. The analysis helps to determine whether an increase or decrease has taken place in particular areas of the financial performance. A horizontal analysis of Wynn’s income statement and balance sheet provides insight into their performance from 2013 and 2014. During this time period, Wynn’s assets increased 8%. Much of this growth was the result of a 37% increase in their investment securities and a 16% increase in their prepaid expenses. However, the firm did experience a 10% decrease in their cash and cash equivalents. The most drastic change occurred in the firm’s stockholder’s equity, which increased nearly 60%. This drastic increase is likely due to the increase in retained earnings over the same period, which increased from $66 million to $164 million. The horizontal analysis of the firm’s consolidated statements of income reveals mostly insubstantial. Wynn

The first method of analysis I will discuss is the horizontal analysis method. Horizontal analysis is a financial statement analysis method that displays a comparison study of income statements or a company’s balance sheet over a period of time (which is at least for two accounting periods). Horizontal analysis deals mainly and focuses on a company or organization’s trends and changes in their financial statements elements, over a period of time. Horizontal analysis also serves the purpose to see whether or not management is achieving their company’s objectives, for companies to evaluate their overall performance,