Ratio Analysis Memo
Angelia Brown, Summer Christian, Tina Gibson, Tonya Hope
October 29, 2013
Ratio Analysis Memo
| Coca-Cola Bottling Co. Consolidated (COKE) |
To: | CEO Mr. J. Frank Harrison III |
From: | Team A |
cc: | Angelia Brown, Summer Christian, Tina Gibson, Tonya Hope |
Date: | October 29, 2013 |
Re: | Ratio’s and analysis |
Good Morning. Here is the memo you requested from Team “A” concerning our findings of the horizontal and vertical analysis for the balance sheet and income statements. We have found through our calculations that the company has been in a slow decline over the past three years. The total current assets are 18.80% as of December 30 2012, whereas it was 23.64% on January 1, 2012. As we begin to calculate the numbers we realized that our current liabilities haven’t increased which is a good thing because we do not want to increase the debt as the income declines. Our total liabilities are 89.46% down from 90.49% a 1.03% decrease. These calculations prove that the financial health of the company is still good however we need to look at the areas that the company has fluctuated and in which quarter our numbers declined so next year promotions can be focused in those areas to increase sales and profits.
The liquidity, profitability and solvency ratios reveal that our company financial position is ok, however we have looked at the completion and overall everybody is within one to five percent of each other. The liquidity ratio is 10:1 in our current assets and 0.7:1 in our acid test. Receivables turnover is 12.6 times and inventories turnover is 2.2 times. Our profitability is 1.21 times in assets turnover ratio in a positive direction. The profit margin is up by 1.7% and return on assets is up 2.04%. Stockholder’s equity equals 2.12% in common stock. The solvency in the debt to total assets is down 8.9% and the times interest earned are 2.5 times for 2012....