Project on Financial Statement of Harrison Plc
Added on -2020-06-06
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Financial Coursework
Table of ContentsINTRODUCTION..........................................................................................................................1PART 1............................................................................................................................................1Q1a: Analysis by using ratios.................................................................................................1Q1.b: Comparative analysis of Harrison’s share price 2012 to 2016.....................................3Q1.c: Assess the strength of premium investment................................................................3CONCLUSION................................................................................................................................4REFERENCES................................................................................................................................5
INTRODUCTIONIn every business organisation, it is essential to make proper analysis of financial positionof the company before making any investment decision. It is consider as one of the crucialaspects for accountant to evaluate each and every financial statements by using certain tools andtechniques (Vogel, 2014). Under this project, financial statement of Harrison Plc is beinganalysed for the period of 2012 to 2016 by using ratios. By this, effective decisions can be madewhether to making investment under the company is profitable for the investors.PART 1Q1a: Analysis by using ratiosFor getting better outcomes for the investors in terms of profitability and effectivedecision in coming time, it is necessary to analyse financial position of Harrison plc. The bestpossible ways to determine the current status is by using various ratios. As, by the help of usefulratios profitability, efficiency and liquidity position of the company can easily be identified(Sheikhi, Ranjbar and Oraee, 2012). Some of them are discussed underneath:Profitability ratio: It refers as systematic class of financial metrics those are utilise to assist abusiness capability to incur revenues compare to all expenses and relevant costs that aregenerated by the company during the time. Types of profitability ratios are:RatiosFormula20122013201420152016Gross profitratiosGross profit /Net sales*1008.072137.9504837.907573818.282327.39277Net profit ratiosNet profit /Net sales *1002.615182.5473722.503209242.864881.87553Operating ratiosOperating income / Totalrevenue *1003.894453.9059713.774069324.201542.9815Return on equity Net income/ Totalshareholder equity*10010.7269.90615210.39076388.696756.20997Return on assetsNet income/Total assets*1004.887954.6450984.646175844.526023.01657Return on capitalemployedOperating profit/ Equityshare capital *1000.386960.4011010.494394620.243660.228191
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