# Financial Ratio Analysis

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### Question Description

Purpose of Assignment

The purpose of this assignment is to help students gain a better understanding of the financial statements used for corporate financial reporting and the key ratios used to make business decisions.

Assignment Steps

Select a Fortune 500 Company from one of the following industries:

• Pharmaceutical
• Energy
• Retail
• Automotive
• Computer Hardware

Review the balance sheet and income statement in the company's 2015 Annual Report.

Calculate the following ratios using Microsoft® Excel®:

• Current Ratio
• Quick Ratio
• Debt Equity Ratio
• Inventory Turnover Ratio
• Receivables Turnover Ratio
• Total Assets Turnover Ratio
• Profit Margin (Net Margin) Ratio
• Return on Assets Ratio

Analyze in 1,050 words why each ratio is important for financial decision making.

Robert__F
School: UT Austin

Company Financials
Target Corporation (www.target.com)

Industry NAICS code: 452910 (Warehouse Clubs and Super Stores)
Income Statement
Fiscal Year ends in January.
\$USD, In whole numbers,
except marked * or %
Column Name
Total Revenue
Cost Of Revenue
Gross Profit
Operating Expenses
SGA Expense
R&D Expense
Other Operating Expenses
Restructuring and Merger/Acquisition
Costs
Amortization
Total Operating Expenses
Operating Income
Misc Other Special Charges
Interest Expense
Gain On Sale Of Security
Other Income (expense)
Pre-Tax Income
Income Taxes
Net Income from Continuous Operations
Net Income for Common Stockholders
Earnings per Share
Basic Earnings per Share
Diluted Earnings per Share
Weighted Average Shares
Basic Average Shares
Diluted Average Shares
Common Dividend

Jan-18

Jan-17

Jan-16

71,879,000,000 69,495,000,000 73,785,000,000
51,125,000,000 48,872,000,000 51,997,000,000
20,754,000,000 20,623,000,000 21,788,000,000
14,248,000,000 13,356,000,000 14,665,000,000
2,194,000,000 2,298,000,000 2,213,000,000
16,442,000,000 15,654,000,000 16,878,000,000
4,312,000,000 4,969,000,000 4,910,000,000
620,000,000
3,646,000,000 3,965,000,000 4,923,000,000
718,000,000 1,296,000,000 1,602,000,000
2,928,000,000
2,934,000,000

2,669,000,000
2,737,000,000

3,321,000,000
3,363,000,000

5.36
5.33

4.74
4.7

5.35
5.31

546,800,000
550,300,000
2.44

577,600,000
582,500,000
2.32

627,700,000
632,900,000
2.16

Balance Sheet
Fiscal Year ends in January.
\$USD, In whole numbers,
except marked * or %
Assets
Current Assets
Cash
Cash And Cash Equivalents
Short-Term Investments
Total Cash
Receivables
Inventory
Deferred Income Taxes
Prepaid Expenses
Other Current Assets
Total Current Assets
Non-Current Assets
Gross Property, Plant & Equipment
Accumulated Depreciation
Net Property, Plant & Equipment
Goodwill
Intangible Assets
Other Long Term Assets
Total Non Current Assets
Total Assets
Liabilities and stockholders' equity
Liabilities
Current Liabilities
Short-Term Debt
Accounts Payable
Deferred Revenues
Accrued Liabilities
Total Current Liabilities
Non-Current Liabilities
Long Term Debt
Deferred Tax Liability
Minority Interest
Pensions & Other Benefits
Other Non Current Liabilities
Total Non Current Liabilities
Total Liabilities
Stockholders' Equity
Common Stock

Jan-18

Jan-17

Jan-16

2,643,000,000 2,512,000,000 4,046,000,000
2,643,000,000 2,512,000,000 4,046,000,000
929,000,000
749,000,000
779,000,000
8,657,000,000 8,309,000,000 8,601,000,000
181,000,000
207,000,000
214,000,000
154,000,000
144,000,000
168,000,000
12,564,000,000 11,990,000,000 14,130,000,000

43,199,000,000
-18,181,000,000
25,018,000,000
630,000,000
152,000,000
26,435,000,000
38,999,000,000

42,071,000,000
-17,413,000,000
24,658,000,000
133,000,000
126,000,000
25,441,000,000
37,431,000,000

41,463,000,000
-16,246,000,000
25,217,000,000
133,000,000
144,000,000
26,132,000,000
40,262,000,000

270,000,000 1,718,000,000
815,000,000
8,677,000,000 7,252,000,000 7,418,000,000
1,000,000
153,000,000
13,201,000,000 12,708,000,000 12,622,000,000
11,317,000,000 11,031,000,000 11,945,000,000
319,000,000
352,000,000
407,000,000
305,000,000
280,000,000
254,000,000
45,000,000

46,000,000

50,000,000

Retained Earnings
Preferred Stock
Treasury Stock
Total Stockholders' Equity
Total Liabilities & Shareholders' Equity

5,858,000,000 5,661,000,000 5,348,000,000
6,553,000,000 5,884,000,000 8,188,000,000
0
0
0
11,709,000,000 10,953,0...

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Anonymous
awesome work thanks

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