Financial Statement Analysis for Tootsie Roll and Hershey

Keeping Cost of Goods Sold at a minimum is just as vital as Marketing and Advertising. Maximum value for both customers and shareholders rely on the company’s operations being as lean as possible and its raw materials prices as low as possible. Tootsie Rolls Industries continually upgrades its plant assets to add capacity, improve quality, or increase efficiency. The company manages cost of raw materials through competitive bidding and using commodities futures

Let’s look at the balance sheet for Tootsie Roll in more detail. First, the assets on a balance sheet are listed by how easy it is for the asset to be converted into cash. The easiest asset to convert to cash is listed first and the hardest to convert is listed last. The ease which an asset can be converted to cash is called liquidity.

thehersheycompany.com went on to say that the Hershey Chocolate is focused on growing their company globally and sharing Hershey 's chocolate around the world.

To consider this we need net credit sales and average receivable balance. This ratio indicates average collection period should be consistent with corporate credit policy. An increase suggests a decline in financial health of customers.

Hershey concentrates on a variety of chocolate products ranging from powder form to an assortment of candy bars, including the famous Hershey Kiss®, to the wholesaling of large decadent chocolate products for other smaller chocolate candy manufacturers.

The Hershey Company is the leading North American manufacturer of quality chocolate, non-chocolate confectionery, and chocolate-related grocery products. The company is also a leader in the gum and mint manufacturer category as well. In this paper, I will discuss the history of the Hershey Company and the impact it has on the United States and the rest of the world.

As of 2008, Hershey Company still appears to be providing strong investor returns. Although its profit margin has decreased, its gross profit rate has remained steady, indicating that the Company is still effectively

Debt to total assets ratio measures the percentage of assets financed by creditors (not stockholders). Debt finance is more risky than equity finance because they must be paid whether a company is doing well or not. Tootsie Roll has a 28% debt to total assets ratio while Hershey’s is 71% indicating that Hershey is taking a higher risk.

11. Accounts receivable turnover and days sales in accounts receivable for the last three years:

One important category is accounts receivables. The average collection period measures the number of days that the company must wait on average between the time of sale and the time when it is paid. The average collection period is calculated in two steps. First, divide annual credit sales by 365 days to determine average sales per day:

Nonetheless, an improvement in age of receivables for a single company over multiple periods suggests a company is becoming more efficient or effective at managing its receivables (Bujaki & Durocher, 2012; Gibson, 2011).

The final ratio we will analyze is the average collection period which measures the time it takes a firm to receive payments after a sale has been made. The average collection period was 55 days for 2001 and 42 days for 2000. While these numbers seem to be very high the reader needs to remember that they are dealing with a large ticket item and financing is usually arranged and payments from the finance company could take more time than cash payments that are normal in the traditional retail marketplace.

The Hershey Company, known until April 2005 as the Hershey Foods Corporation and commonly called Hershey 's, is the largest chocolate manufacturer in North America. Its headquarters are in Hershey, Pennsylvania, which is also home to Hershey 's Chocolate World. It was founded by Milton S. Hershey in 1894 as the Hershey Chocolate Company, a subsidiary of his Lancaster Caramel Company. Hershey 's products are sold in about sixty countries worldwide. In addition, Hershey is a member of the World Cocoa Foundation. The company has been topped to 384, compared with the previous rank 404, in 2013 (CNN, 2013). This paper is going to show the company’s international environment,

In 1894, the Hershey Chocolate Company began in Lancaster, Pennsylvania when Milton Hershey decided to begin producing chocolate coating for his caramels. In 1900, Hershey expanded their business by producing more goods. Once Hershey began mass production, they were able to minimize production costs and make high-quality milk chocolate. After this new production model was established, Hershey began to expand its facilities throughout the northeastern United States. They also increased their supply chain efficiency by building a new facility in close proximity to ports and dairy farms that supply Hershey with its raw materials.

The hershey food cooperation is a confectionery kind of industry that was founded in 1894 by Milton Hershey who is a candy-manufacturer who decided to try adding chocolate to his caramels; transforming the name of his enterprise the Hershey Chocolate. This new factory was located strategically near dairy farms and surrounded by the spirits of hardworking people , by 1900 production of the delicious mil chocolate took place. Followed that, the launch of so many