Tesco's Financial Performance: A Ratio Analysis and Strategic Review

This report provides a financial analysis of Tesco, focusing on its mission, vision, and performance evaluation through key financial ratios. It begins by introducing accounting as a systematic process for recording financial transactions to assess a company's performance. Tesco's background is briefly discussed, highlighting its founding and evolution. The report then delves into efficiency and profitability ratios, including accounts receivable turnover, working capital ratio, asset turnover ratio, inventory turnover ratio, days sales in inventory, gross profit margin ratio, operating profit margin, and net profit margin ratio. The analysis aims to measure Tesco's overall performance and identify areas for strategic improvement to minimize risk and enhance customer service with better quality products at reasonable prices. The conclusion emphasizes the importance of ratios as tools for measuring company performance and informing strategic adjustments. Desklib offers this assignment solution along with a wealth of study resources.

Introduction
Accounting may be defined as a systematic process of
recording of financial transactions in order to evaluate
performance of company. Financial statements help
company in taking key decision so that they can attain its
objectives effectively and efficiently. They are referred as
indicators which indicates current performance of
company in terms of efficiency and profitability.
Poster
Company’s Background
Tesco was founded by jack Cohen, a son of Jewish
emigrants from Poland and started to sell excess
groceries from Well Street market. This company was
first appeared in 1924. Tesco name came about after the
shipment of tea from Thomas Edward Stockwell. The
labels were made on his and suppliers name, three
letters from suppliers name and two(Co) from his name
References
• Kahn, M.J. and Baum, N., 2020. Basic
statements. In The Business Basics of Building
and Managing a Healthcare Practice (pp. 13-
18). Springer, Cham.
• Husna, A. and Satria, I., 2019. Effects of
return on asset, debt to asset ratio, current
ratio, firm size, and dividend payout ratio on
firm value. International Journal of
Economics and Financial Issues, 9(5), p.50.
• accounting and interpretation of financial
Mission and Vision
The mission of Tesco is to become champion of
customers. The main aim for company is to
serve with better quality of products at a
reasonable price. Company wants to capture a
larger customer base so that it could generate
more profit along with keeping its operations
sustainable.
Profitability ratio
• Gross profit margin ratio
• Operating profit margin
• Net profit margin ratio
Conclusion
From the above poster, it has been concluded
that ratios are the most important tool that
helps in measuring the overall performance of
company along with taking effective measures
in order to alter strategies so that it can
minimise risk.
Efficiency ratio
• Accounts Receivable Turnover ratio
• Working capital ratio
• Assets turnover ratio
• Inventory turnover Ratio
• Days sales in inventory