4 pages report

User Generated

qsqs44

Business Finance

Description

Here’s a link to the annual report for Lancaster Colony, which is a mid-sized company in the Food industry. You can find the financial statements halfway through the annual report.

http://www.lancastercolony.com/investors/sec-filings-and-annual-reports/annual-reports/default.aspx




Assume a new vice-president is leading your unit and you have been asked to provide her with a reviewof your corporation’s financial statements. The VP professes to know “next to nothing” aboutaccounting and financial reports but trusts your new-found skills in understanding the statements.
Prepare a written report that:
Identifies the primary financial statements, their purpose, and the elements and types of lineitems contained in the statements. Discuss how the structure of the statements is affected by

the type of legal structure of your company and the type of business it conducts.Explains the connection between the statement of earnings and the balance sheet and also howthe statement of cash flows connects to the statement of earnings and balance sheet.Calculates the fourteen ratios listed on the following page and discusses the trends andpositive/negative nature of the ratios (individually, but in the context of the four categories). Inyour separate ratio listing, show the detail (numerator and denominator) used for each of theratios, and calculate two years of ratios so that a basic sense of the trend can be seen. Roundthe numbers in an appropriate manner, and show percentages as percentages.

Assessment:Grading will be based on the accuracy of the calculations (42 points: 14 ratios x 3 points each) and on
the quality of the narrative (33 points: Structure/flow of the report and presentation of the ratios,quality of the writing (sentence structure, appropriate language), and professionalism of the financial

statement review.

RATIOS
Liquidity
1) Working Capital2) Current Ratio3) Quick Ratio4) Free Cash Flow

Activity
5) Accounts Receivable Turnover6) Days Sales in A/R7) Inventory Turnover8) Days Sales in Inventory

Solvency
9) Debt to Equity Ratio10) Interest Coverage Ratio (Times Interest Earned)

Profitability

11) Gross Profit Margin12) Return on Assets13) Return on Equity14) “EBITDA”

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Explanation & Answer

Attached.

Running head: LANCASTER COLONY CORP.

1

Lancaster Colony Corp.
Instructor name
Submitted by
Date

LANCASTER COLONY CORP.

2

Lancaster Colony Corp.
Introduction
Lancaster Colony Corp. is a maker and advertiser of nourishment items for the retail and
foodservice markets. It works through Special sustenance segments. The Specialty nourishments
fabricate and showcase plate of mixed greens dressings and sauces; fruit glazes, vegetable
plunges and organic product plunges; solidified hearth-heated loaves of bread.
Primary financial statements
The primary financial statement includes the balance sheet, income statement, cash flow
statement and shareholder equity statement. The purpose of the balance sheet is to uncover the
financial status of a business starting at a particular point in time. The statement indicates what a
substance claims (assets) and the amount it owes (liabilities), and also the sum put resources into
the business (value). This data is more important when the balance sheets for a few sequential
periods are assembled together so that patterns in the distinctive details can be seen. (“The
purpose of the balance sheet”, 2015) Various elements of the balance sheet as shown in the
annual report are current assets, other assets, current liabilities, shareholder equity, etc. The line
items include cash, inventories, land, machinery, goodwill, accounts payable, preferred stock,
etc. The purpose of the income statement is to demonstrate the user how much profit or loss an
association produced amid a detailing period. This data is more profitable when income
statements from a few sequential periods are gathered together so that patterns in the diverse
income and cost line items can be seen. T...


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Just the thing I needed, saved me a lot of time.

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