Hsm260 Analyzing Financial Management

HSM 260 XYZ Corporation, Analyzing Financial Management, Instructor: Joyce White 2012)

XYZ Corporation: Analyzing Financial Management

YOUR NAME

HSM/260

July 1st 2012

INSTRUCTOR

The following document covers accounting terms, methods, and funding for a specific corporation. Focusing on conceptual understanding and financial management as it applies to the XYZ Corporation. This will bring a better understanding of past, present, and future financial standings, and the aspects of the corporation during the years 2002-2004.

| 2002 | 2003 | 2004 |

Current Ratio | .75 | .87 | .90 |

Long-Term Solvency Ratio | 1.26 | 1.38 | 2.06 |

Contribution Ratio | .53 | .51 | .49 |

Programs/Expense Ratio | 1.0 | 1.0 | 1.11 |

General and Management/Expense Ratio | .30 | .28 | .23 |

Fundraising /expense Ratio | NA |

Revenue/Expense Ratio | .98 | .94 | 1.11 |

Each ratio is important for all three years of the Data for XYZ Corporation. Below are the reasons each ratio is important.

1. Current Ratio – The purpose of the current ratio is to assess the nonprofit service agency’s liquidity. Current Ratio is important because it allows the agency to make sure they are not facing any liquidity problems. The problems mean the extent to which the agency has cash. The assets readily converted into cash to cover current operating expenses.

2. Contribution Ratio – The purpose of the contribution ratio is to assess the agency’s dependency (major revenue source)! It is important because it...