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Question #1: Financial Statement Analysis

Instructions:

• Refer to the (annual) financial statements for NORDSTROM posted on the course site.

• You should also read Item #7 - "Management's Discussion and Analysis of Condition and Results of Operations" (pgs. 19 - 46) in the company's 10K Form (2011) to complete this assignment.

a) Using the first approach discussed in my Chapter 2 handout calculate the relevant liquidity ratios for 2010 and 2011, and compare their evolution during this period.

a) Did the firm's liquidity improve between 2010 and 2011?

b) What factors contributed to this trend? Explain.

b) Using the second approach, calculate the relevant liquidity ratios for 2010 and 2011, and compare their evolution during this period.

a) Did the firm's liquidity improve between 2010 and 2011?

b) What factors contributed to this trend? Explain.

c) Calculate NORDSTROM'S profitability ratios for 2010 and 2011, and discuss their evolution during this period.

a) Based on your analysis, has management's ability to generate operating profits on the firm's assets improved? Explain.

d) Calculate the relevant asset management ratios for NORDSTROM for 2010 and 2011.

a) Based on your calculations, explain what happened to firm's ability to manage its assets effectively.

e) Retail performance metrics:

a) Based on the information provided in the company's 10K Form, discuss the evolution of NORDSTROM'S sales per square foot, and retail selling, general, and administrative expenses per square foot between 2010 and 2011.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M91601117
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