Performance Measures. Information from the 2012 Form 990 and the 2013 annual report for Feeding America , follows. Although the Form 990 indicates it is for 2012, it is actually for the period July 1, 2012, to June 30, 2013, the same time period as the 2013 annual report. Use the following information to complete the exercise.

Required

a. Compute the following performance measures using the Form 990 data presented in this exercise and comment on what information they convey to a potential donor without comparing them to prior years or other comparable agencies.

1. Current ratio—liquidity.

2. Revenues/expenses—going concern.

3. Program expenses/total expenses—program effectiveness.

4. Public support/fund-raising expenses—fund-raising efficiency.

b. Using the annual financial statements provided in this exercise, calculate the same ratios listed in requirement a. Comment on any differences.

c. Discuss the advantages of analyzing financial performance using audited annual financial statement information versus IRS Form 990 information.

Answer rating: 100% (QA)

a 1 Performance measure The performance measure can indicate the context of raw data expressed in the financial statements Here the financial ratios performance measure point out how efficiently the N... View the full answer