Unit $2$ Assignment: Case $1-3$: Comparative Analysis, Credit, and Equity

In this assignment, you will be assessed based on the following Outcome:

MT$482-1$: Examine the financial performance of a company using its financial statements.

This assignment will firmly plant your feet in the world of financial statement analysis, setting the stage for much of what you will do going forward. It is challenging but will set you up with tools to make better business decisions going forward, in this class and in the real world.

Locate Case $1-3$: Comparative Analysis, Credit, and Equity on page $61$ of your text. Be sure to submit thoughtful and substantial answers to the questions following the case regarding the two companies analyzed.

Assume each company paid a cash dividend of $$1\mathrm{.}50$ per share and that each company$$s stock can be purchased at $$25$ a Compute each company$$s price$-$earnings ratio and dividend yield.

Identify which company$$s stock you would recommend as the better investment and explain.

Financial Statement of Nike & Reebok

Key Figures Nike Reebok

Finanicng $($liablities $+$ equity$)$ $$5,397\mathrm{.}40$ $$1,756\mathrm{.}10$

Net $($income$)$ $$399\mathrm{.}60$ $$135\mathrm{.}10$

Revenue $($sales$)$ $$9,553\mathrm{.}10$ $$3,637\mathrm{.}40$

Cash & equivalents $$108\mathrm{.}60$ $$209\mathrm{.}80$

Accounts receivable $$1,674\mathrm{.}40$ $$561\mathrm{.}70$

Inventories $$1,396\mathrm{.}60$ $$563\mathrm{.}70$

Retained Earnings $$3,043\mathrm{.}40$ $$1,145\mathrm{.}30$

Costs of sales $$6,065\mathrm{.}50$ $$2,294\mathrm{.}00$

Income Taxes $$253\mathrm{.}40$ $$12\mathrm{.}50$

Revenues $$9,953\mathrm{.}10$ $$0$

Net Sales $($Reebok$)$ $$0$ $$3,643\mathrm{.}60$

Total Assets $$5,397\mathrm{.}40$ $$1,756\mathrm{.}10$