Winter Study Program - Accounting
Financial Evaluation of a Company
Due Date: Tuesday, January 25, 2011 noon
To Be Given to Instructor in Classroom
 
(a) Form a group of 3 members (or if needed 5). After your team has been formed, select, as a group, one of the five companies from a list that I will provide in class.  Company selection will be on a first come, first serve basis.  By Thursday, January 6, 2011, indicate your selected company on the list provided in class.
(b) As soon as possible, I would suggest that you review the company’s 10-K at the Edgar database.
(c) For the company your group selected, type a paper (maximum 10 pages, double-spaced) indicating the following: 
1. the industry (or industries) in which your company operates
2. the nature of your company's business
3. the names of the major competitors for your company
4. the status of you company within its industry
5. the Friday, December 31, 2010 closing stock price
6. the Thursday, January 21, 2011 closing stock price
7. the reasons for the change in market price from December 31, 2010 to January 21, 2011
8. using the company's annual report calculate the following ratios for the most recent year:
a.

asset turnover
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          Business Owners' Toolkit

b.

current ratio
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          Current Ratio Calculator
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c. acid-test ratio
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d. accounts receivable turnover ratio
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e. inventory turnover ratio
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f. property, plant and equipment turnover
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g.

long-term debt to total assets or long-term debt to stockholders' equity
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h. dividend payout ratio
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          Investopedia
i. price-earnings ratio at January 21, 2011 (to be determined from finance.yahoo.com)
Be sure to show your calculations for all ratios (except the price-earnings ratio)
9. For each of the ratios calculated above, indicate its significance as it pertains to your company (is the company doing good, bad, fair, etc.; is the ratio a positive indicator or a negative indicator for your company).  You might compare the ratios for your company to those of other companies in the industry.
     The paper will be evaluated not only for the quality of comments but also for the quality of presentation, grammar, sentence structure, spelling, etc.  Failure to complete these requirements when due will result in no (zero) points being earned for this project, and thus a failing grade for the course.

Last Updated:  12/30/10