MT 217 UNIT 3 TEAM ASSIGNMENT

Your paper, based upon your team's collective analysis, should include a measure of and analysis of financial outcomes based on the ratios for each financial ratio classification (i.e., the liquidity classifications of ratios are based upon the quick and current ratio outcomes). You will calculate ratios for each classification for the 3 years of data (i.e., the current ratio may have been 1.5 the first year, 1.35 the second year, and .75 in the most recent year). It is based on these results that you will measure financial performance, or trends, from one year to the next. It is imperative that the ratios- numbers, and quantitative outcomes, support your analysis. 1. Using the data from the Income Statement and Balance Sheet, provide the correct calculation of the liquidity ratios and an assessment of the company's ability to maintain liquidity and the management of current assets and current liabilities. Include the proper assessment of outcomes as positive or negative trends when all ratio outcomes are factored as a group. Liquidity Ratios . Current Ratio . Quick Ratio 2. Using the data from the Income Statement and Balance Sheet, provide the correct calculation of the activity ratios and an assessment of the company's ability to maintain liquidity. Include the proper assessment of outcomes as positive or negative trends when all four ratio outcomes are factored as a group. Activity Ratios . Inventory Turnover . Accounts Receivables Turnover . Total Asset Turnover . Average Collection Period 3. Using the data from the Income Statement and Balance Sheet, provide the correct calculation of the financing ratios. Include the proper assessment of outcomes as positive or negative trends when all three ratio outcomes are factored as a group. Financing Ratios . Debt Ratio Debt-to-Equity Ratio . Times Interest Earned Ratio 4. Using the data from the price per share data, the Income Statement, and the Balance Sheet, provide the correct calculation for the market value ratios below. Market Value Ratios . Earnings per Share (EPS) . Price Earnings (PE) 5. Using the data from the Income Statement and Balance Sheet, provide the correct calculation of these four profitability ratios and an assessment of the company's ability to maintain if not improve profitabilityMarket Value Ratios Earnings per Share (EPS) * Price Earnings (PE) 5. Using the data from the Income Statement and Balance Sheet, provide the correct calculation of these four profitability ratios and an assessment of the company's ability to maintain if not improve profitability based on the amounts of equity, assets, and levels of profits from sales. Include the proper assessment of outcomes as positive or negative trends when all four ratio outcomes are factored as a group. Profitability Ratios * Return on Equity (ROE) * Return on Assets (ROA) * Net Profit Margin Operating Profit Margin Part 2 In this part of your assignment, you will compose an analytical study reporting your results from Part 1. The CEO of your company is forming a task force to review the financials and present a review for acquisition of ABC Company. Based on ABC''s previous 3 years of financials, determine if this would be a good acquisition. You must form the task force to complete the task. The CEO would like most of the departments to participate in the process. Using each department''s area of expertise, what information would each of the following departments contribute to the final decision? Provide a minimum one-paragraph response for each department. Finance Department Sales Department * Marketing Department * Human Resources * Legal Department Part 3 After your team has provided their input on the effect the acquisition will have on their department, perform an overall analysis to explain your recommendation to the CEO. Your analysis should include the following: Explain how the company is trending based on the year-over-year ratios. Compare the company to the industry average in Appendix A in the Excel workbook in areas of profitability, management effectiveness, and efficiency. Based on the above, summarize the pros and cons of ABC Company using both the year-over-year ratio analysis from Part 1 and the industry average comparisons from Part 3. * Provide the team''s final recommendation as to whether or not the CEO should invest in ABC Company