Ford Business Analysis

1797 Words Oct 9th, 2011 8 Pages
A company’s financial health is the deciding factor of future growth. As humans, we rely on health checkups to improve and maintain our health. Same thing goes for businesses. Without maintaining proper financial health that company will not be around long afterwards. I want to begin by presenting and comparing Ford Motor Company’s income statement, balance sheet, and cash flow to determine the financial health of the company versus two of the company’s current competitors.
Income Statement
Five different categories are covered on a company’s income statement. Those categories are Total Revenue, Gross Profit, Operating Income or Loss, Net Income, and Net Income Applicable to Common Shares. These categories are usually
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Total current inventory reported for Ford Motor Company was $48,875,000. General Motors reported $53,053,000 and Honda Motors reported $56,588,000. Total Assets is another figure in itself. Total assets is the sum of all assets, current and long term, owned by the company. Ford Motor Company invests more money in the long term than General Motors and Honda combined. Investing in long term, if your money compounds will generate earnings from previous earnings. Albert Einstein referred to compound interest as the greatest mathematical discovery of all time. Benjamin Franklin stated, “Money makes money, and the money that makes money, makes money.” Property Plant and Equipment,, Goodwill, Intangible assets, Accumulated amortization, Other assets, Deferred long term asset changes, also determine final figures when calculating Total assets. Ford is leading in that category. Liabilities are also on the balance sheet. Liabilities are the debts a company owes for the 12 month period. Liabilities consist of accounts payable, short/current long term debt, deferred long tern liability charges, minority interest, and negative goodwill. According to figures, Ford Motor Company has twice as much liability as Honda Motors. Stockholders’ equity, often referred to as the book value of the company, is an accumulation of total-assets minus total liabilities. Equity comes from two sources, originally invested money, and earnings retained by the company that accumulated over time
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