Prior to beginning work on this assignment, retrieve the financial statements(Q3 2022) you downloaded for Deere &
Question:
Prior to beginning work on this assignment, retrieve the financial statements(Q3 2022) you downloaded for Deere & Company, and download the following financial statements for Caterpillar Inc., per the instructions below.
Files to Download
Note: You should still have the reports for Deere & Company from the files you downloaded in Week 1. |
One critical component of financial analysis involves comparing a firm's financial statements with other firms in the industry. Through such a comparison, financial managers can reveal useful information about risks, investment opportunities, market indicators, and economic factors.
Throughout this course, you have been researching and analyzing various financial statements for Deere & Company. For this Final Paper, you will culminate your analysis with an in-depth comparison of Deere & Company and Caterpillar Inc.
In your project, you will complete the following items based on the files you downloaded above:
- Examine the four primary financial statements for each firm and address the following:
- Statement of Cash Flows:
- Compare the statement of cash flows for the two firms, noting the major inflows and outflows of cash.
- Income Statement:
- Compare the income statements for the two firms, noting the issues each one faces regarding sales projections.
- Balance Sheet:
- Compare the balance sheets for the two firms, noting any issues each firm may want to address regarding liability, and how each firm might be impacted by increasing interest rates.
- Shareholder Equity:
- Calculate the shareholder equity for each firm.
- Calculate the following ratios and trend analyses on each company:
- ROI analysis
- Ratio analysis, to include the following ratios:
- Profit Margin
- Return on Assets
- Return on equity
- Receivable Turnover
- Average Collection period
- Inventory turnover
- Current ratio
- Working Capital
- Debt to total assets
- Debt to equity
- Earnings per share
- Price to Earnings ratio
- Horizontal, vertical, and trend analysis of financial statements
- Compare and contrast the two firms in the context of the global economy, noting which types of cultural differences might impact each firm as it does business in other countries.
- Include examples to illustrate your point.
- Compare and contrast each firm's global strategic plan based on the information in the annual report from two years ago.
- Propose which company would be better to invest in, based on the above comparisons. Your proposal should include the key metrics you used to make your decision.
Auditing A Practical Approach with Data Analytics
ISBN: 978-1119401742
1st edition
Authors: Raymond N. Johnson, Laura Davis Wiley, Robyn Moroney, Fiona Campbell, Jane Hamilton