Overview
In preparation for your report in Project Two, you will need to calculate the financial ratios needed to determine your chosen business’s cu
ent financial health. Once you’ve calculated these ratios, the results will be used to analyze the business’s cu
ent financial position and help them make decisions about how to improve or maintain their financial health. Pay particular attention to working capital management. If liquidity is an issue, consider how the company will meet its short-term obligations.
Prompt
Using the Project Two Financial Formulas Spreadsheet spreadsheet and the balance sheet, income statement, and cash flow statement from Mergent Online for your chosen company, calculate the financial ratios for the most recent fiscal quarter. Then, compare those ratios with the same ratios for the same fiscal quarter from one year prior in Mergent Online, and analyze your results.
Specifically, you must address the following ru
ic criteria:
· Financial Calculations: Calculate accurate financial ratios to assess the business’s cu
ent financial health. Specifically, calculate the following ratios:
· Working capital
· Cu
ent ratio
· Debt ratio
· Earnings per share
· Price/earnings ratio
· Total asset turnover ratio
· Financial leverage
· Net profit margin
· Return on assets
· Return on equity
· Fiscal Quarter Comparison: Using Mergent Online, summarize the differences between the results from your financial calculations of the most recent fiscal quarter and the results of the same financial calculations of the same fiscal quarter from a year before for your chosen business.
· For example, if the most recent fiscal quarter available is the 3rd quarter in 2020, then you will compare those results to the same financial calculations from the 3rd quarter in 2019.
· Comparison Analysis: Explain what the results of your calculations and your comparison indicate about the business’s cu
ent financial health, providing examples to support your explanation. You might consider the following questions:
· Do the results indicate the business is financially healthy or financially unhealthy? Which results indicate this?
· What might be the cause(s) of the business’s financial success or failure?
· Is more information needed to determine the business’s financial health? If so, which pieces of information might still be needed?
· Short-Term Financing: Explain how potential short-term financing sources could help the business raise needed funds to improve its financial health. Base your response on the business’s cu
ent financial information.
RATIOS
ACCOUNTING & FINANCIAL RATIOS
CURRENT RATIO (Cu
ent Assets / Cu
ent Liabilities) TOTAL ASSET TURNOVER RATIO (Total Revenue / Total Assets)
Cu
ent Assets Total Revenue
Cu
ent Liabilities ERROR:#DIV/0! Total Assets ERROR:#DIV/0!
WORKING CAPITAL (Cu
ent Assets - Cu
ent Liabilities)
: *Note to students: Be mindful of the scale being used in Mergent Online when filling this out. If a number is written as 12.53, that does not mean the total for that item is $12.53. There could be numerous zeros written after it, depending on the scale labeled above. In this example, 12.53 is actually $12,530,000. (To delete this comment, right-click on the "WORKING CAPITAL" box, then select Delete Comment from the drop-down menu.) FINANCIAL LEVERAGE (Total Assets / Shareholder's Equity)
Cu
ent Assets Total Assets
Cu
ent Liabilities 0 Shareholder's Equity ERROR:#DIV/0!
DEBT RATIO (Total Debt / Total Assets) NET PROFIT MARGIN (Net Income / Total Revenue)
Total Debt Net Income
Total Assets ERROR:#DIV/0! Total Revenue ERROR:#DIV/0!
EARNINGS PER SHARE (Net Income / Weighted Average Common Shares Outstanding) RETURN ON ASSETS (Net Income / Total Assets)
Net Income Net Income
Shares Outstanding ERROR:#DIV/0! Total Assets ERROR:#DIV/0!
PRICE EARNINGS RATIO (Share Price (end of quarter / EPS) RETURN ON EQUITY (Net Income - Prefe
ed Dividends / Shareholder's Equity)
Stock Price NI - Pref. Div.
EPS ERROR:#DIV/0! Shareholder's Equity ERROR:#DIV/0!
Monthly
Time Value of Money - Monthly Compounding
Rate of Return Year 1
Initial Investment Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 2
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 3
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 4
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 5
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 6
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 7
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 8
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 9
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Year 10
Month 1 2 3 4 5 6 7 8 9 10 11 12
Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Annual
Time Value of Money - Annual Compounding
Rate of Return Year 1 2 3 4 5 6 7 8 9 10
Initial Investment Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Investment Value $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
PV
Time Value of Money - Present Value Annuity
Number of Years
Rate of Return $0.00
Payment
FV
Time Value of Money - Future Value Annuity
Number of Years
Rate of Return $0.00
Payment
PV - Lump Sum
Time Value of Money - Present Value of Lump Sum
Rate
Years $0.00
Initial Investment
FV - Lump Sum
Time Value of Money - Future Value of Lump Sum
Rate
Years $0.00
Initial Investment
NPV
Net Present Value (NPV) Calculato
Building
Initial Investment Year 1 2 3 4 5 6 7 8 9 10
Annual Cash Inflows Cash Flows $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Discount Rate NPV = $0 Year 11 12 13 14 15 16 17 18 19 20
Number of Years Cash Flows $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Salvage Value
Equipment
Initial Investment Year 1 2 3 4 5 6 7 8 9 10
Annual Cash Inflows Cash Flows $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Discount Rate NPV = $0 Year 11 12 13 14 15 16 17 18 19 20
Number of Years Cash Flows $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Salvage Value
Bonds
Initial Investment
Annual Cash Inflows
Discount Rate NPV = $0 Year 1 2 3 4 5 6 7 8 9 10
Number of Years Cash Flows $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Principal Returned
Untitled Spreadsheet
asreported
Disney (Walt) Co. (The) (NYS: DIS)
Exchange rate used is that of the Year End reported date
As Reported Quarterly Balance Sheet
Report Date 07/03/2021 04/03/2021 01/02/2021 06/27/2020 03/28/2020 12/28/2019
3rd Quarter 2nd Quarter 1st Quarter 3rd Quarter 2nd Quarter 1st Quarte
Cu
ency USD USD USD USD USD USD
Audit Status Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Consolidated Yes Yes Yes Yes Yes Yes
Scale Thousands Thousands Thousands Thousands Thousands Thousands
Cash & cash equivalents XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX 6833000
Receivables XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Inventories 1344000 1406000 1480000 1559000 1531000 1571000
Licensed content costs & advances 2367000 2204000 1423000 3135000 1869000 1334000
Other cu
ent assets 830000 844000 852000 899000 1003000 938000
Assets held for sale - - - - - -
Total cu
ent assets XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Produced & licensed content costs XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Investments 4045000 4309000 4037000 3611000 3180000 3312000
Attractions, buildings & equipment XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Accumulated depreciation - attractions, buildings & equipment XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Parks, resorts & other property before projects in progress & land, Total XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Projects in progress 4856000 4891000 4547000 4380000 3916000 4023000
Land 1077000 1075000 1079000 1020000 1019000 1019000
Parks, resorts & other property, net XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Intangible assets, net XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Goodwill XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Noncu
ent assets held for sale - - - - - -
Other assets 8508000 8085000 8343000 8435000 8575000 8443000
Total assets XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Accounts payable & other accrued liabilities XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Cu
ent portion of bo
owings 4728000 5243000 5397000 XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Defe
ed revenue & other cu
ent liabilities 4368000 4337000 4303000 3707000 4891000 5024000
Liabilities held for sale - - - - - -
Total cu
ent liabilities XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Commercial paper bo
owings - - - - 8483000 6534000
U.S. & European medium-term notes - - - - - -
U.S. dollar denominated notes - - - - XXXXXXXXXX XXXXXXXXXX
Asia International Theme Parks bo
owings - - - - - -
Asia Theme Parks bo
owings - - - - 1185000 1146000
Foreign cu
ency denominated debt & other bo
owings - - - - 1489000 1015000
Total bo
owings before cu
ent portion - - - - XXXXXXXXXX XXXXXXXXXX
Less: cu
ent portion of bo
owings - - - - XXXXXXXXXX XXXXXXXXXX
Bo
owings XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Defe
ed income taxes 6835000 6894000 7201000 7055000 7965000 8364000
Noncu
ent liabilities held for sale - - - - - -
Other long-term liabilities XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Redeemable noncontrolling interests 9492000 9410000 9330000 9162000 9096000 9029000
Common stock XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Retained earnings (accumulated deficit) XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Market value adjustments for investments - - - -6000 - -
Market value adjustments for hedges -213000 - -324000 - 122000 -7000
Market value adjustments - -214000 - - - -
Unrecognized pension & postretirement medical expense XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Foreign cu
ency translation & other accumulated comprehensive income (loss) -912000 -823000 -745000 XXXXXXXXXX XXXXXXXXXX -887000
Accumulated other comprehensive income (loss) XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Shareholders' equity sub-total - - - - - -
Treasury stock, at cost 907000 907000 907000 907000 907000 907000
Total disney shareholders' equity XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Noncontrolling interests 4381000 4246000 4657000 4597000 4470000 5016000
Total equity XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Untitled Spreadsheet
asreported
Disney (Walt) Co. (The) (NYS: DIS)
Exchange rate used is that of the Year End reported date
As Reported Quarterly Cash Flow
Report Date 07/03/2021 04/03/2021 01/02/2021 06/27/2020 03/28/2020 12/28/2019
3rd Quarter 2nd Quarter 1st Quarter 3rd Quarter 2nd Quarter 1st Quarte
Cu
ency USD USD USD USD USD USD
Audit Status Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Consolidated Yes Yes Yes Yes Yes Yes
Scale Thousands Thousands Thousands Thousands Thousands Thousands
Net income (loss) - - - - - -
Net income (loss) from continuing operations 2280000 1152000 30000 XXXXXXXXXX 2708000 2173000
Depreciation & amortization 3836000 2570000 1298000 4010000 2631000 1298000
Net gain/(loss) on investments - -481000 -80000 - - -
Goodwill & intangible asset impairment - - - 4953000 - -
Net loss (gain) on investments -325000 - - - - -
Net loss (gain) on acquisitions & investments - - - -370000 - -
Loss (gain) on acquisition - - - - - -
Defe
ed income taxes -749000 -556000 -105000 -548000 297000 534000
Equity in the loss (income) of investees -648000 -437000 -224000 -545000 -359000 -224000
Cash distributions received from equity investees 546000 372000 193000 567000 405000 219000
Net change in produced & licensed content costs & advances XXXXXXXXXX XXXXXXXXXX 771000 XXXXXXXXXX -925000 -77000
Net change in operating lease right of use assets / liabilities 127000 146000 36000 16000 -96000 -
Equity-based compensation 428000 270000 134000 388000 246000 115000
Other adjustments, net 728000 490000 90000 471000 156000 65000
Receivables -301000 -37000 XXXXXXXXXX 2100000 828000 XXXXXXXXXX
Inventories 236000 175000 94000 86000 70000 81000
Other assets -113000 -131000 -136000 8000 -174000 -33000
Accounts payable & other accrued liabilities - - - - - -
Accounts payable & other liabilities 341000 -780000 -642000 XXXXXXXXXX -888000 -841000
Income taxes -260000 400000 -60000 95000 -112000 -256000
Net cash flows from operations - continuing operations - - - 5949000 4787000 -
Net cash flows from operating activities 2934000 1468000 75000 5949000 - 1630000
Investments in parks, resorts & other property XXXXXXXXXX XXXXXXXXXX -760000 XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Acquisitions - - - - - -
Other investing activities 383000 203000 28000 -27000 -21000 -12000
Net cash flows from (used in) investing activities - continuing operations - - - XXXXXXXXXX XXXXXXXXXX -
Net cash flows from investing activities XXXXXXXXXX XXXXXXXXXX -732000 XXXXXXXXXX - XXXXXXXXXX
Commercial paper bo
owings/(payments), net -99000 -87000 -179000 1373000 3138000 1172000
Bo
owings 43000 37000 1000 XXXXXXXXXX 6071000 51000
Reduction of bo
owings XXXXXXXXXX XXXXXXXXXX -139000 XXXXXXXXXX XXXXXXXXXX -46000
Dividends - - - XXXXXXXXXX XXXXXXXXXX -
Proceeds from exercise of stock options 405000 394000 209000 238000 207000 126000
Acquisition of noncontrolling & redeemable noncontrolling interests - - - - - -
Contributions from or sales of noncontrolling interests - - - - - -
Other financing activities -801000 -769000 -225000 -838000 -165000 -186000
Net cash flows from financing activities - continuing operations - - - XXXXXXXXXX 6616000 -
Net cash flows from financing activities XXXXXXXXXX XXXXXXXXXX -333000 XXXXXXXXXX - 1117000
Cash flows from operating activities of discontinued operations -2000 4000 - 2000 4000 -
Cash flows from financing activities of discontinued operations - - - - - -
Cash flows from investing activities of discontinued operations 8000 4000 - 198000 198000 -
Cash flows from operations - discontinued operations 6000 8000 9000 200000 202000 -19000
Impact of exchange rates on cash, cash equivalents & restricted cash 77000 70000 139000 -49000 -76000 41000
Change in cash, cash equivalents & restricted cash XXXXXXXXXX XXXXXXXXXX -842000 XXXXXXXXXX 8923000 1419000
Cash, cash equivalents & restricted cash, beginning of period XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX 5455000 5455000 5455000
Cash, cash equivalents & restricted cash, end of period XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX 6874000
Untitled Spreadsheet
asreported
Disney (Walt) Co. (The) (NYS: DIS)
Exchange rate used is that of the Year End reported date
As Reported Quarterly Income Statement
Report Date 07/03/2021 04/03/2021 01/02/2021 06/27/2020 03/28/2020 12/28/2019
3rd Quarter 2nd Quarter 1st Quarter 3rd Quarter 2nd Quarter 1st Quarte
Cu
ency USD USD USD USD USD USD
Audit Status Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Consolidated Yes Yes Yes Yes Yes Yes
Scale Thousands Thousands Thousands Thousands Thousands Thousands
Services revenues XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Products revenues 1437000 1091000 1378000 544000 1835000 2783000
Total revenues XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Cost of services (exclusive of depreciation & amortization) XXXXXXXXXX 8932000 XXXXXXXXXX 7209000 XXXXXXXXXX XXXXXXXXXX
Cost of products (exclusive of depreciation & amortization) 982000 850000 1037000 687000 1254000 1639000
Selling, general, administrative & other expenses 3168000 3113000 2917000 2455000 3388000 3703000
Depreciation & amortization 1266000 1272000 1298000 1377000 1333000 1298000
Total costs & expenses XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
Restructuring & impairment charges - - - - - -
Restructuring & impairment charges 35000 414000 113000 5047000 145000 150000
DraftKings, Inc. gain (loss) -217000 - - - - -
German free-to-air (FTA) television network gain (loss) 126000 - - - - -
Other income (expense), net -91000 305000 - 382000 - -
Other income - - - - - -
Interest expense 404000 415000 404000 456000 365000 362000
Interest & investment income -9000 131000 - 41000 63000 -
Net periodic pension & postretirement benefit costs (other than service costs) -32000 -36000 - 3000 2000 -
Interest income, investment income & other interest income (expense) - - 80000 - - 79000
Interest income (expense), net -445000 -320000 -324000 -412000 -300000 -283000
Equity in the income (loss) of investees 211000 213000 224000 186000 135000 224000
Income from continuing operations before income taxes 995000 1230000 46000 XXXXXXXXXX 1060000 2632000
Income taxes from continuing operations -133000 108000 16000 -331000 525000 459000
Net income (loss) from continuing operations 1128000 1122000 30000 XXXXXXXXXX 535000 2173000
Income (loss) from discontinued operations, net -5000 -11000 -12000 -3000 -15000 -26000
Net income (loss) 1123000 1111000 18000 XXXXXXXXXX 520000 2147000
Net income (loss) from continuing operations attributable to noncontrolling interests -205000 -210000 -1000 -209000 -60000 -40000
Less: net income from continuing operations attributable to noncontrolling & redeemable noncontrolling interests - - - - - -
Less: net income from discontinued operations attributable to noncontrolling interests - - - - - -
Net income (loss) attributable to The Walt Disney Company (Disney) 918000 901000 17000 XXXXXXXXXX 460000 2107000
Weighted average shares outstanding - basic 1818000 1817000 1812000 1809000 1808000 1805000
Weighted average shares outstanding - diluted 1830000 1829000 1823000 1809000 1816000 1817000
Year end shares outstanding 1781000 1781000 1781000 1781000 1781000 1781000
Earnings (loss) per share - continuing operations - basic 0.51 0.5 0.02 -2.61 0.26 1.18
Earnings (loss) per share - discontinued operations - basic - -0.01 -0.01 - -0.01 -0.01
Net earnings (loss) per share - basic 0.5 0.5 0.01 -2.61 0.25 1.17
Earnings (loss) per share - continuing operations - diluted 0.5 0.5 0.02 -2.61 0.26 1.17
Earnings (loss) per share - discontinued operations - diluted - -0.01 -0.01 - -0.01 -0.01
Net earnings (loss) per share - diluted 0.5 0.49 0.01 -2.61 0.25 1.16
Dividends declared per common share - - - 0.88 0.88 0.88