Analysis of Financial Statements

Added on - 01 May 2020

  • 15

    pages

  • 3438

    words

  • 2

    views

  • 0

    downloads

Showing pages 1 to 4 of 15 pages
Running Head: ANALYSIS OF FINANCIAL STATEMENTSANALYSIS OF FINANCIAL STATEMENTSRatio Analysis
Analysis Of Financial Statements1ContentsIntroduction................................................................................................................................2Ratio Analysis............................................................................................................................2Financial statements...................................................................................................................3Microsoft Corporation............................................................................................................3(Source: Financials.morningstar.com, 2017)..........................................................................4Oracle Corporation.................................................................................................................4(Source: Financials.morningstar.com, 2017)..........................................................................6Analysis and interpretation........................................................................................................6Liquidity ratios.......................................................................................................................6Efficiency ratios......................................................................................................................8Profitability ratios...................................................................................................................9Capital structure ratio...........................................................................................................11Conclusion................................................................................................................................12References................................................................................................................................14
Analysis Of Financial Statements2IntroductionFinancial analysis focus on evaluating financial position of the company. It is done withthe use of final accounts of the company which are prepared at the end of the financial year.This analysis shows the profitability, efficiency, liquidity and overall fiancé structure of acompany. This report is all about the critical examination of the performance and position ofthe two companies which are Microsoft and Oracle. A comparative analysis of the financialposition of these two companies is done to know which company is more profitable andefficient form investor’s point of view (Vogel, 2014).Microsoft Corporation is a multinational information technology company. It is anAmerica based company whose founder is Bill Gates and Paul Allen. It manufactures,licenses, and sells a wide range of software products and services. Its known softwareproducts are Microsoft Windows, Microsoft Office Suite and Internet Explorer. It alsodesigns and sell hardware devices such as Xbox, Windows phone and so on (Microsoft.com,2017).Oracle Corporation is a computer technology corporation which basically deals indeveloping database software, cloud engineered systems and enterprise software products. Itis considered to be the largest software developer after Microsoft and is also amongstMicrosoft’s main competitors. Larry Ellison, Bob Miner and Ed Qates are the founders of thiscorporation. Oracle Applications, Oracle database, servers are some products produced anddeliver by the corporation(Oracle.com, 2017).In this report, Ratio analysis of the final accounts of both the companies is done so to letthe investors know about the better performing company to invest in.Ratio AnalysisTo measure company’s profitability, efficiency, liquidity and to know about its overallfinance structure, the method of ratio analysis is used. It includes measurement for severalcategorized ratios to know about the different aspects of an organisation. They are classifiedas liquidity ratios, solvency ratios, activity ratios, efficiency ratios, and profitability ratios. Toanalyse the final accounts of both the companies, ratio analysis is done (Fraser, Ormiston andFraser, 2010).
Analysis Of Financial Statements3Financial statementsMicrosoft CorporationBalance sheet 2016-2017Particulars20162017AUD$AUD$AssetsCash & Equivalents1,13,2401,32,981Trade Accounts Receivable18,27719,792Inventory2,2512,181Other Current Assets5,8924,897Total Current Assets1,39,6601,59,851Long-Term Investments10,4316,023Net Fixed Assets18,35623,734Intangible Assets3,73310,106Other Non-Current Assets21,51441,372Total Non-Current Assets54,03481,235Total Assets1,93,6942,41,086LiabilitiesAccounts Payable6,8987,390Taxes Payable580718Accrued Liabilities5,2645,819Short-Term Debt12,90410,121Deferred Revenues27,46834,102Other Current Liabilities6,2436,377Total Current Liabilities59,35764,527Long-Term Debt40,78376,073Other Long-Term Liabilities21,55728,092Total Long-Term Liabilities62,3401,04,165Total Liabilities1,21,6971,68,692Retained Earnings2,2822,648Other Equity69,71569,746Total Liabilities and Equity1,93,6942,41,086Income statement for the year 2016-2017Particulars20162017AUD$AUD$Sales85,32089,950
desklib-logo
You’re reading a preview
card-image

To View Complete Document

Become a Desklib Library Member.
Subscribe to our plans

Download This Document