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Financial analysts play a number of roles within an organization. They made assessments of the value of investments the firm has or may have in the future. They can specialize in determining the value of projects. In addition, financial analysts are engaged in risk assessment, and take steps to determining the best ways for the firm to mitigate the risks that have been identified. Overall, financial analysts use a multitude of different knowledge sets including taxes, finance, economics and risk management to assist the company in making the best financial decisions for the firm (BLS, 2010).
a )The net profit would be the gross profit less operating expenses, interest expenses and tax expenses. Thus, the net profit is: $1,000,000 - $345,000 - $125,000 = $530,000. From this the taxes are removed: $530,000 * (1-.3) = $371,000. The preferred stock dividends of $57,000 must then be removed in order to determine the earnings available for common shareholders:
$371,000...
This is $63,750. The increase in retained earnings therefore is:
$314,000 - $63,750 = $250,250.
3. Financial ratios are a set of ratios that are used to measure the financial performance of a firm. Based on the financial statements, the ratios measure the firm's liquidity, solvency, profitability, operating performance, returns, cash flow and investment valuation (Loth, 2011).
Financial leverage is the degree to which the firm's operations are financial by debt. A high degree of leverage reflects a high debt level; low leverage is low debt. The higher the debt, the more of a firm's earnings are earmarked for debt repayment. Thus, there is greater risk to the equity shareholder the more debt a firm has, as the firm's ability to generate a return for the shareholder is reduced.
Ratio analysis…
Works Cited
BLS. (2010). Occupational Outlook Handbook 2010-11 Edition. Bureau of Labor Statistics. Retrieved May 21, 2011 from http://www.bls.gov/oco/ocos301.htm
Loth, R. (2011). Financial ratios tutorial. Investopedia. Retrieved May 21, 2011 from http://www.investopedia.com/university/ratios/
The median wage for financial analysts was $73,150 excluding bonuses. The bottom ten percent in the profession earn less than $43,400 and the top ten percent earn over $141,070. Annual bonuses are very common in the industry and can account for a substantial portion of the total earnings (OOH, 2010). Benefit packages are typically very strong for financial analysts. Specific information for Miami-Dade County is unobtainable, but the city
Financial managers and CEO's play important roles in ensuring that organizations meet their specific goals. The skill levels for both positions are high and require a great deal of patience and experience. The purpose of this discussion is to determine whether being a financial manager is the best preparation for later becoming a CEO. Role of the Financial Manager According to the Bureau of Labor, financial managers must have a bachelor's degree
The company's promotional literature emphasizes the synergistic effects of this corporate structure: "IAG combines the two leading airlines in the UK and Spain, enabling them to enhance their presence in the aviation market while retaining their individual brands and current operations. The airlines' customers benefit from a larger combined network for both passengers and cargo and a greater ability to invest in new products and services through improved financial
Despite this fundamental difference, financial and compliance managers work together as healthcare organizations make decisions to lower cost, increase revenue, and improve care. The concept of lowering cost while improving care presents a complex demand, and requires both financial and compliance officers to possess fundamental management knowledge, and similar professional skills in order to implement accounting and ethical standards (Buelow, et al. 2010). For example, a legal requirement or
It is hoped that the value added by the UDA system will help to increase sales of the core product. The division manager of Gadgets has a valid point in regards to the overall impact on the Division's profits. He had a valid reason for requesting this exception to the rules. It may at first appear that the Gadget Division manager is acting out of self-interest and protectionism. However,
Pre-Interview QuestionsTell me about your work experience as it relates to this position?In my most recent role at HNTB Corporation, I�ve maintained a number of responsibilities that align closely with the Project Accountant role at WSP. I\\\'ve performed detailed financial analyses, focusing on key performance indicators like budget adherence, earnings variances, and cash flow. One of my notable achievements was developing a plan to resolve Delinquent Billing & AR balances