Caledonia

Disney’s financial performance from past two years…….

Current ratio= current assets/current liabilities

2010 12,225. Divided by 11,000.= 1.111

2011 15,060. divided by 13,524= 1.113

In 2010 Disney’s current assets were 12,225M vs. it’s current liabilities of 11M. This brought Disney’s current ratio to 1.11 in debt for every dollar of assets vs. 2011 which shows a 1.113 in debt for every dollar.

Debt ratio

In 2010 Disney has .899 in debt for every dollar of assets. In 2011 their debt for each dollar of assets is 1.113 which is slightly higher than 2010 . Based on these calculations Disney’s ratio is in good health. In order for the company to be in desirable health, the ratio should be 1 or less. This shows that Disney at present is a considerably lower than 1.

Return on investment= Net income /shareholder equity

2010= 4,313,000 . divided by 37,519,000. = 11.49

2011=1,521,000. Divided by 37,257,000= 40.8

Disney’s return on equity shows how well they have reinvested their earnings. To generate additional earnings it shows their efficiency in their investment.

ROE average is 12% for Disney. Really good for any company is 15-18%. If a company is over 30% this is considered too much risk.

Days Receivables= Accounts receivable divided by annual sales on credit x 365

2010 12,225,000. Divided by 38,063,000. X 365 this is equivalent to 11.7 days

2011 15,060,000. Divided by 10,779,000. X 365 this is equivalent to 50.9 days

In 2011 it took a customer 39.2 days more to pay fr purchases than in 2010. This means that Disney’s profit was less in 2011 than in 2010.