Analyzing Financial Statements

Analyzing Financial Statements

Betty Miller

HSM/260

November 15, 2015

Andrea Peleg

Analyzing Financial Statements

Part 1

2002 Ratios

Current ratio: $104,296.00/$139,017.00 = .75

Long-term solvency ratio: $391,270.00/$310,246.00 = 1.26

Contribution ratio: $617,169.00/$1,665,065.00 = .53

Programs and expense ratio: $834,008.00/1,185,008.00 = .70

The general management/expense ratio: $351,000.00/$1,185,008.00 = .30

Revenue and expense ratio: $1,165,065.00/$1,185,008.00 = .98

2003 Ratios

Current ratio: $82,058.00/$93,975.00 = .87

Long-term solvency ratio: $$359,863.00/$259,979.00 = 1.38

Contribution ratio: $632,889.00/$1,244,261.00 = .51

Programs and expense ratio: I do not have a figure for program expenses in appendix D. The only figure I had is for 2002 and you provided this for me when you corrected my paper. Under expenses the program services is blank all across the board for all three years.

The general management/expense ratio: $371,101.00/$1,316,681.00 = .28

Revenue and expense ratio: $1,244,261.00/$1,316,681.00 = .94

2004 Ratios

Current ratio: $302,902.00/$337,033.00 = .90

Long-term solvency ratio: $699,004.00/$338,937.00 = 2.06

Contribution ratio: $1,078,837.00/$2,191,243.00 = .49

Programs and expense ratio: See above note under same listing.

The general management/expense ratio: $445,819.00/$1,972,131.00 = .23

Revenue and expense ratio: $2,191,243.00/$1,972,131.00 = 1.1

Part 2

Current ratios are used to get an idea of a certain period or in comparability to prior years. The current ratio echoes the agency’s capability to pay off short-term debt. Long-term solvency ratio is used to gauge an agency’s capability to meet their debt and other responsibilities. The long-term solvency ratio tells if an agency’s cash flow is enough to meet its short-term and long-term liabilities. The lower the ratio the greater chance the agency will default on their loan responsibilities. Contribution ratio calculates the profit capacity for...