I put the actual instructions files below. But basically, its calculating financial ratios
from Your Company's Website. (MCDONALDS)
I chose to do my assignment over McDonald's organization SEC
filings.
Here's the link to the Sec Filings (scroll to the bottom)
https://corporate.mcdonalds.com/corpmcd/investors/financial-information.html
RESM 4190 – Assignment #4 (40 points) You must cite all information obtained from places other than your own personal experience and knowledge using a PA format. Use Purdue owl to ensure your citations are incorrect APA format. https://owl.purdue.edu/owl/research_and_citation/apa_style/apa_formatting_and_style_guid e/general_format.html The assignment should be in your own words. It is acceptable to use information from the Internet and other sources if they are properly cited. However, you cannot simply cut-and-paste a bunch of content you find on the Internet and slash or other sources. This is plagiarism and you will not get credit for this. CAUTION: A “detailed” sentence means it explains something and has proper sentence structure and grammar. For example, “According to Toyota's 2021 Income Statement, the company had a gross profit of $43,732,000.” Conversely, writing, “Gross profit = $43,732,000.” is not a detailed sentence and it will not count toward your minimum number of sentences. Section 1. Current Ratio (9 points) For further explanation see: https://www.youtube.com/watch?v=sWWnsvuQ3kk ❖ Calculate your company/organization’s Current Ratio (refer to Chapter 8). ❖ You must explain how you calculated the ratio by including: o The formula you used for the calculation. o Where you located all the numbers in the calculation (i.e., Income Statement, Balance Sheet, etc.). ❖ Provide at least 3 detailed sentences explaining the ratio. Some things to discuss may include: o What does the ratio tell you? o Is the ratio good, average, bad, etc.? o Is the ratio higher or lower than previous years? o Any other thoughts you have on what this ration reveals about the financial position of the company/organization. Section 2. Quick Ratio (9 points) For further explanation see: https://www.youtube.com/watch?v=J_NM9TVwgfU ❖ Calculate your company/organization’s Quick Ratio (refer to Chapter 8). ❖ You must explain how you calculated the ratio by including: o The formula you used for the calculation. o Where you located all the numbers in the calculation (i.e., Income Statement, Balance Sheet, etc.). https://owl.purdue.edu/owl/research_and_citation/apa_style/apa_formatting_and_style_guide/general_format.html https://owl.purdue.edu/owl/research_and_citation/apa_style/apa_formatting_and_style_guide/general_format.html https://www.youtube.com/watch?v=sWWnsvuQ3kk https://www.youtube.com/watch?v=J_NM9TVwgfU ❖ Provide at least 3 detailed sentences explaining the ratio. Some things to discuss may include: o What does the ratio tell you? o Is the ratio good, average, bad, etc.? o Is the ratio higher or lower than previous years? o Any other thoughts you have on what this ration reveals about the financial position of the company/organization. Section 3. Return on Sales (Net Profit Margin) (9 points) For further explanation see: https://www.youtube.com/watch?v=Hx4vVoN4uLs ❖ Calculate your company/organization’s Return on Sales Ratio (refer to Chapter 8). ❖ You must explain how you calculated the ratio by including: o The formula you used for the calculation. o Where you located all the numbers in the calculation (i.e., Income Statement, Balance Sheet, etc.). ❖ Provide at least 3 detailed sentences explaining the “ratio.” Some things to discuss may include: o What does the ratio tell you? o Is the ratio good, average, bad, etc.? o Is the ratio higher or lower than previous years? o Any other thoughts you have on what this ration reveals about the financial position of the company/organization. Section 4. Debt-to-Total Asset Ratio (Debt Ratio) (9 points) For further explanation see: ❖ Calculate your company/organization’s Average Collection Period (refer to Chapter 8). ❖ You must explain how you calculated the ratio by including: o The formula you used for the calculation. o Where you located all the numbers in the calculation (i.e., Income Statement, Balance Sheet, etc.). ❖ Provide at least 3 detailed sentences explaining the ratio. Some things to discuss may include: o What does the ratio tell you? o Is the ratio good, average, bad, etc.? o Is the ratio higher or lower than previous years? o Any other thoughts you have on what this ration reveals about the financial position of the company/organization. https://www.youtube.com/watch?v=Hx4vVoN4uLs Section 5. What is the SIC Code for your company/organization? ❖ Look this up online if it is not obvious on your company’s website. Query something like “SIC Code for ____ “ (name of your company). ❖ Include both the SIC number and title of that code. Submitting the Assignment to Canvas (4 points) ❖ The project assignment MUST be submitted as a single PDF document. ❖ All five (5) sections should be included in the document and be in the exact order they are listed: o Section 1 – Current Ratio o Section 2 – Quick Ratio o Section 3 – Return on Sales (Net Profit Margin) o Section 4 – Debt-to-Total Asset Ratio (Debt Ratio) o Section 5 – SIC Code ❖ Each of the five sections of the PDF should start on a new page. o Thus, your Assignment should be at least 5 pages. Calculating Financial Ratios from Your Company's Website (MCDONALDS) I chose to do my assignment over McDonald's organization SEC filings. Here's the link to the Sec Filings (scroll to the bottom) https://corporate.mcdonalds.com/corpmcd/investors/financial-information.html When you calculate financial ratios, please refer to the following table: Assignment 4 Ratio Chart. (Download Document) RATIO FORMULA INFORMATION SOURCE LIQUIDITY RATIOS Current Current Assets/Current Liabilities Balance Sheet Quick (Current Assest-Inventory)/Current Liabilities Balance Sheet Net Working Capital Current Assets - Current Liabilities Balance Sheet ACTIVITY (EFFICIENCY) RATIOS Total Asset Turnover Net Sales/Average Total Assets Balance & Income Inventory Turnover Costs of Goods Sold/Average Inventory Balance & Income Receivable Turnover Revenues (net sales)/Average Accounts Receivable Balance & Income DEBT/COVERAGE/LEVERAGE/SOLVENCY RATIOS Debt (Debt-to-Total Asset) Total Liabilities/Total Assets Balance Sheet Equity Ratio Equity/Total Assets Balance Sheet PROFITABILITY RATIOS Return on Sales (Net Profit Margin) Net Income/Net Sales or Revenues Income Statement Return on Equity New Income/Shareholders' or Owners' Equity Balance & Income Return on Assets (Productive) Net Income/Total Assets Balance & Income FIRM VALUATION (MARKET PROSPECT) RATIOS Market Value Price per share of common stock X number of outstanding shares Balance & Stock Market Price-to-Earnings Price per share of common stock/Earnings per share Balance & Income Earnings Per Share Net Income/Number of outstanding shares of common stock Balance & Income