You chose a business during your Module Two journal assignment. Imagine you are an analyst for that business. Your businesss board of directors wants updates on the businesss financial
Competencies
In this project, you will demonstrate your mastery of the following competencies:
Analyze financial and investment decisions that add value to the organization
Analyze financing options to maximize investor value
Scenario
You chose a business during your Module Two journal assignment. Imagine you are an analyst for that business. Your businesss board of directors wants updates on the businesss financial health. Your supervisor has asked you to write a report that includes the following:
The businesss current financial health
The available financial options for improving the business
Your recommendations about which options will support the businesss financial health
Your supervisor will present your report to the businesss board of directors. The board members have different levels of knowledge about finance. You must write the report so it is easy for all board members to understand.
Directions
Create a report for your supervisor to share with the board of directors during their presentation. Use the business you chose from the Project Two Business Options List. Use Mergent Online to find the most recent quarterly financial statements for your company. Use these statements to support your analysis during the project. Use the Project Two Financial Assumptions document for descriptions of the three financial options you will evaluate. Use the Project Two Financial Analysis Report template to complete this project.
Note: All documents and resources that are needed to complete this assignment are linked in the What to Submit and Supporting Materials sections.
Specifically, you must address the following rubric criteria:
Financial Analysis:?For this section, you will start with calculating the financial formulas listed in Part A. Use the most recent quarterly financial statements from your chosen business and the Project Two Financial Formulas worksheet.
Financial Calculations:?Accurately calculate financial formulas to figure out the businesss current financial health. You must calculate the following:
Working capital
Current ratio
Debt ratio
Earnings per share
Price/earnings ratio
Total asset turnover ratio
Financial leverage
Net profit margin
Return on assets
Return on equity
Working Capital Management:?Explain the impact of working capital management on the businesss operations. Provide examples to support your claims.
Financing:?Explain how a business finances its operations and expansion.
Short-Term Financing:?Explain how potential short-term financing sources could help the business raise funds for improving its financial health. Base your response on the businesss current financial information.
Bond Investment:?Discuss the risks and benefits of the business investing in a corporate bond. Include the necessary ethical factors, appropriate calculations, and examples to support your analysis. Use the Project Two Financial Assumptions document and the Bonds section of the Net Present Value (NPV) worksheet in the Project Two Financial Formulas workbook.
Capital Equipment:?Discuss the risks and benefits of the business investing in capital equipment. Include the necessary ethical factors, appropriate calculations, and examples to support your analysis. Use the Project Two Financial Assumptions document and the Equipment section of the Net Present Value (NPV) worksheet in the Project Two Financial Formulas workbook.
Building:?Discuss the risks and benefits of the business investing in a building. Include the necessary ethical factors, appropriate calculations, and examples to support your analysis. Use the Project Two Financial Assumptions document and the Building section of the NPV worksheet in the Project Two Financial Formulas workbook.
Financial Evaluation:?In this section of the report, you will determine which of the three available investments are good financing options and describe the businesss likely future financial performance.
Bond Investment:?Determine if the bond investment is a good financing option for the businesss financial health. Use your financial analysis and other financial information to your support claims.
Capital Equipment:?Determine if the capital equipment investment is a good financing option for the businesss financial health. Use your financial analysis and other financial information to support your claims.
Building:?Determine if the building investment is a good financing option for the businesss financial health. Use your financial analysis and other financial information to support your claims.
Future Financial Considerations:?Describe the businesss likely future financial performance. Base your description on the businesss current financial well-being and risk levels. Use financial information to support your claims.
What to Submit
To complete this project, you must submit the following:
Financial Analysis Report
Submit your completed Project Two Financial Analysis Report.
You must also submit the Excel files for your chosen businesss balance sheet, income statement, and cash flow statement from Mergent Online.
Workbook: Project Two Financial Formulas
Use this Excel workbook to complete your calculations for the project. You should have already completed the Ratios worksheets for your Project Two Milestone assignment.
All sources should be cited according to APA style. This includes sources listed in your Project Two Financial Formulas workbook. Consult the Shapiro Library APA Style Guide for more information on citations.
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