Excel Sheet Link: https://1drv.ms/x/s!AjVSWM6NrnDcaYI5IpcVdH0DVJc For company Z,
ID: 2812373 • Letter: E
Question
Excel Sheet Link:
https://1drv.ms/x/s!AjVSWM6NrnDcaYI5IpcVdH0DVJc
For company Z, you have the financial statement (f.01) for the end of round 3 shown above.
Replicate Z’s ratios in the financial statement spreadsheet provided. Open the spreadsheet and move to the right. Don’t alter the column or row labels in the range of J1 to N25. Follow the example shown for the Gross Margin and describe the formula in words then show the numerator and denominator values. The ratio value will appear (replacing ‘#DIV/0’) when you enter the cell reference for the numerator and denominator values. Use cell reference “formulas” For example: Enter a cell reference such as =E28, do NOT type in the literal value, such as 21,238,784.1.
To figure out the formulas use a finance or accounting textbook or simple search on the Internet. Be sure to match exactly the ratios shown above, including values to the right of the decimal point. Use the minus sign or ABS() function, if needed, to make the ratio value shown.
In the shaded green area, provide a short explanation of what this financial ratio tells about the company’s financial standing (an example explanation is given for the marketing-to-sales ratio). You must complete: net margin, return on equity, return on assets, debt to equity and marketing to sales.
Explanation / Answer
Net Margin= (Net Income/Total Revenue) Shows how much Net income is generated from Total Revenue Return on Equity=Net Income/Total Shareholder's Equity Shows how much net income is generated from Equity shareholder's contribution Retun on Assets=Net Income/Total Assets Shows how much profit is generated by using total assets of the company Debt to Equity=Total Debt/Total Shareholder's Equity Shows proportion of company's assets that are financed by borrowing Marketing to Sales=Total marketing expenses/Total Revenue Shows how much marketing expenses helped to generate new sales
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