Calculate the current ratio and quick ratio for the latest two years, obtain the industry average...

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Calculate the current ratio and quick ratio for the latest two years, obtain the industry average ratios fromIBISWorld, and analyze the results.This database contains industry reports and market research on more than 1,300 United States industries. The reports provide key data, financial ratios, and benchmarks, plus industry forecasts. IBISWorld’s Data Wizard tool allows comparisons between a chosen company and industry best practices.Discuss what each of these ratios tells you about the company’s current financial condition, and how they compare to the industry averages.Identify the major causes of any changes in these ratios and discuss your assessment of the company based on these changes.Review the balance sheet and the notes to the most recent financial statements, and identify any contingent liabilities.Discuss whether or not you agree with how the company chose to treat each contingency on the financial statements (i.e., recorded vs. disclosed, but not recorded).Discuss the effect on the financial statements of the company’s treatment of the contingency.Discuss whether the contingent liabilities change your assessment of the company.

Tanmoy · Accepted Answer

Corporate Finance – Adobe Inc
Ratio Analysis of Adobe v. Industry
	Particulars
	2018
	2017
	Current Assets
	4857039
	7247813
	Current Liabilities
	4301126
	3527457
	Cash and Cash Equivalents
	1642775
	2306072
	Short Term Investments
	1586187
	3513702
	Trade Receivables, net of allowances for Doubtful Debt
	1315578
	1217968
	 
	 
	 
	Adobe Current Ratio
	1.13
	2.05
	Industry Current Ratio
	1.10
	1.10
	Adobe Quick Ratio
	1.06
	2.00
	Industry Quick Ratio
	0.90
	1.00
Current ratio of a firm states its ability to meet the short term or current obligations. The ideal current ratio is 2:1. This means the current ratio is twice the current liabilities. It indicates satisfactory position of the firm. For Adobe we can observe that the current ratio in 2018 is 1.13 and in 2017 it is 2.05. While the industry in which Adobe operates and as per IBIS World report is 1.10 in both 2018 & 2017.

Calculate the current ratio and quick ratio for the latest two years, obtain the industry average ratios fromIBISWorld, and analyze the results. This database contains industry reports and market...

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