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Financial Management Assignment- The Target Corporation

   

Added on  2020-05-28

9 Pages1508 Words67 Views
Running Head: Analysis of Target CorporationStudent name:Course name:Instructor name:Date Submitted:
Financial Management Assignment- The Target Corporation_1
Running Head: Analysis of Target CorporationIntroductionThe Target corporation company mainly offers merchandise at discount price to the customer fromvarious stores located in Minnesota. The company focuses to deliver a good shopping experience totheir customer, supported by their supply chain and technology. Our ability to deliver a preferredshopping experience to our guests is supported by our supply chain(Irvine Lapsley, 2016). Companyoperated in single segment designed to enable the customer to buy products seamless in store thoughvarious digital channels. Solution-ai.Profitability:Operating margin = EBIT/SalesOperating margin = $4,969/$69,495Operating margin = 64.71%Profit margin = Net income/SalesProfit margin = $2,737/$69,495Profit margin = 3.94%Return on assets (ROA) = Net income/Total assetsReturn on assets (ROA) = $2,737/$40,262 Return on assets (ROA) = 6.80%
Financial Management Assignment- The Target Corporation_2
Running Head: Analysis of Target CorporationReturn on equity (ROE) = Net income/Total common equityReturn on equity (ROE) = $2,737/$12,957Return on equity (ROE) = 0.22ii.Debt ManagementDebt ratio = (Total Assets – Total Owner’s Equity)/Total assetsDebt ratio = ($40,262 - $12,975)/$40,262Debt ratio = 0.68Equity Multiplier = Total Assets /Total Owner’s EquityEquity Multiplier = $40,262/$12,957Equity Multiplier = 3.11iii.LiquidityCurrent ratio = Current Asset/ Current liabilitiesCurrent ratio = $14,130/$12,622 Current ratio = 1.12Quick ratio = (Current assets – Inventory)/Current liabilitiesQuick ratio = ($14,130 – $8,601)/$12,622Quick ratio = 0.44iv. Asset ManagementAsset Turnover=Sales/Average Total AssetsAsset Turnover= $69,495/$38,846.5Asset Turnover = 1.79Inventory turnover = Cost of sales/ Average InventoryInventory turnover = $48,872/ ($8,309 + $8,601)/2
Financial Management Assignment- The Target Corporation_3

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