Ask Question, Ask an Expert


Ask Basic Finance Expert

This Portfolio Project has two parts: calculations and a 4- to 6-page essay. While the computations requirements of this assignment are significant, equally significant are your discussion and analysis of quantitative results of AT&T financial statement. You have to create two files:1) a spreadsheet containing AT&T’s horizontal and vertical analysis (and perhaps AT&T ratios) and 2) a word document containing your essay.

Select publicly traded company (AT&T, Inc) and carry out the expanded analysis on financial statements. Use the most current 10K statements available on or annual statements in

Part 1: Complete following for your selected firm in the Excel spreadsheet:

1. Horizontal and vertical analysis of Income Statements for the past three years (all yearly balances set as a percentage of total revenues for that year).

2. Horizontal and vertical analysis of Balance Sheets for the past three years (all yearly balances set as a percentage of total assets for that year).

3. Ratio analysis (eight ratios of your choosing) for past three years PLUS a measurement for the credit worthiness of your firm as measured by Altman’s Z-score.  Note that if you used your chosen firm for our ratio-related discussion posts, then you must also present industry-average ratios or current year competitor ratios for your ratio analysis. Comparing your firm’s ratios to a close competitor or an industry-average ratio makes your analysis much more meaningful.

Part 2: The Paper:

• 4-6 pages in length.

• Include a proper introduction and conclusion.

• Include a reference page.

• Your paper must provide your reader with the overall understanding of the financial health of your chosen firm including the following:

i) Discussion of the ratio analysis results, including rationale for the ratios chosen.

ii) Discussion of all horizontal and vertical analysis.

iii) Discussion of four items from the management discussion of the firm that support the conclusion formed in your discussion of the financial results.

Much of this course has concentrated on learning financial statements, mainly as there was not an accounting prerequisite. Because of this concentration, you may find this assignment challenging. Though, if you understand the financial statements, then the horizontal and vertical analysis must (hopefully) be rather intuitive. Such as, if you see sales rise by 20%, then should not you also see net income rise by 20% or more if the managers are effective at controlling costs?  If you see sales rise by 20% and assets rise by 40%, we have to ask why this is happening. It would appear that assets have risen too far given the sales that are generated from those assets—why did this occur?  You may have to research that type of problem and discuss it in your analysis.

You have had some experience with financial ratios through Discussion Board.  I’d suggest that you start your ratio analysis with four ratios found in DuPont equation. If you discover the weakness in one component of DuPont ratios, then it would make sense to look at ratios which are closely related to troublesome ratio. Such as, if you discover that the asset turnover is declining over time, then take a look at some related ratios like the inventory turnover rate or the average collection period. If you discover that the equity multiplier is increasing (indicating greater reliance on debt), then look at some related ratios such as the debt ratio or Times Interest Earned.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M96229

Have any Question? 

Related Questions in Basic Finance

What do we mean by the term torque reaction a right angle

What do we mean by the term torque reaction? A right angle nut runner is used to produce 500 ft-lb of torque on a bolt having a 7/8 -9 UNC thread. The tool is 18 in. long. How much reaction force, created by the reaction ...

1 some people purposely ignore a bill and put it out of

1. Some people purposely ignore a bill and put it out of their minds in order to avoid the stress associated with it. Other people pay their bills immediately because they worry that they might forget about paying them. ...

Bob entered into a land contract to purchase real estate

Bob entered into a land contract to purchase real estate from Sam. The purchase price was to be paid over a 10-year period by monthly amortization. At the end of five years, Bob defaulted, having failed to make his requi ...

In formulating key concept exercise consider the following

In formulating Key Concept Exercise, consider the following questions: What are the benefits of just-in-time (JIT) techniques? What types of organisations use JIT techniques? Should things change if they are running smoo ...

The following information was available spot rate for

The following information was available: Spot rate for Japanese yen: $0.009313 730-day forward rate for Japanese yen: $0.010475 (assume a 365-day year) U.S. risk-free rate: 7.0 percent Japanese risk-free rate: 1.0 percen ...

Design a randomized groups experiment to test the

Design a randomized groups experiment to test the hypothesis that children who watch an hour-long violent television show subsequently play in a more aggressive fashion than children who watch a nonviolent TV show or who ...

Build on the design you created in question 1 to test the

Build on the design you created in Question 1 to test the hypothesis that the effects of watching violent TV shows will be greater for boys than for girls. (What kind of design is this?) Question 1 Design a randomized gr ...

Cost of debt sincere stationery corporation needs to raise

(Cost of debt) Sincere Stationery Corporation needs to raise $450,000 to improve its manufacturing plant. It has decided to issue a $1,000 par value bond with an annual coupon rate of 18 percent and a maturity of 12 year ...

1 why is motor carrier freight transportation the most

1. Why is motor carrier freight transportation the most preferred method of product shipment? 2. What is the economic justification for the recent rapid growth of premium package services? 3. Why is it important for a lo ...

Problem -the balance sheet of perseverance corporation on

Problem - The balance sheet of PERSEVERANCE CORPORATION on December 31, 2005, includes the following cash and receivable balances: Cash - Davao Bank   P 45,000 Currency and coins   16,000 Petty cash fund   1,000 Cash in ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro