Bus 325:financial management assignment 1

Financial Statement Analysis (PART I):

A hypothetical company, ABC Corp, has the following financial statements for Year 1:

1. Income Statement: Revenue: $500,000; COGS: $300,000; Operating Expenses: $100,000; Net Income: $50,000.

2. Balance Sheet: Total Assets: $700,000; Liabilities: $300,000; Shareholders' Equity: $400,000.

3. Cash Flow Statement: Operating Cash Flow: $60,000; Investing Cash Flow: -$20,000; Financing Cash Flow: $10,000.

• Analyze each financial statement:

• Define the purpose of the Income Statement, Balance Sheet, and Cash Flow Statement.

• Break down and explain key figures, such as Net Income, Total Assets, and Operating Cash Flow.

• Assess the impact of a hypothetical scenario: ABC Corp increases its revenue by 10% but also incurs 5% higher operating expenses.

• Deliverable:

  • Written Analysis: A well-structured analysis of 700-800 words submitted in Word or Google Docs format.

  • Formatting Requirements: The document must be formatted in Times New Roman, 12-point font, double-spaced, with standard 1-inch margins.

• • • Academic Integrity: This assignment requires you to present your own thoughts and analysis. If referencing external sources—including books, articles, or websites—you must provide proper citations in APA format. Plagiarism, including the use of uncredited material or direct copying, will not be tolerated. Your submission should demonstrate critical thinking, originality, and a clear understanding of the subject matter.

Ratio Analysis Exercise (PART II):

• • Example financial data for Company “XYZ”:

1. Current Assets: $150,000

2. Current Liabilities: $100,000

3. Total Assets: $500,000

4. Total Liabilities: $200,000

5. Shareholders' Equity: $300,000

6. Net Income: $60,000

• Tasks:

  • Calculate the following ratios: Current Ratio, Debt-to-Equity Ratio, ROA, and ROE.

• Deliverable:

  • Written Analysis: A well-structured analysis of 300-400 300-400 words discussing the calculated ratios and their potential impact on Company XYZ. The report should be submitted in Word or Google Docs format.

  • Formatting Requirements: The document must be formatted in Times New Roman, 12-point font, double-spaced, with standard 1-inch margins.

• • • Academic Integrity: This assignment requires you to present your own thoughts and analysis. If referencing external sources—including books, articles, or websites—you must provide proper citations in APA format. Plagiarism, including the use of uncredited material or direct copying, will not be tolerated. Your submission should demonstrate critical thinking, originality, and a clear understanding of the subject matter.