FINANCIAL ANALYSIS

Financial Analysis

Financial Analysis

Introduction

The process of analyzing financial statements is described in different ways depending on the task at hand. It can be used as a screening tool for selecting areas for investment options, or mergers. It can also serve as a tool for predicting future financial conditions and results. Analysis of financial statements is applicable to identify performance management issues. It can be used for the evaluation of the company's management. Depending on the purpose of the analysis, attention is concentrated on the appropriate form of financial analysis. The company we will be analyzing in this report is Toyta Motor Corporation. Toyota Motor Corporation (Toyota Motor Corporation, British universal: Toyota Motor Corporation), the Aichi Prefecture, Toyota City is an automobile manufacturer headquartered in the town Toyota address. They have recorded consolidated sales of around ¥ 20 trillion annually, as a single giant company. They are Japan's largest manufacturer and have offices around the world.

Calculation of Ratios

Ratios

Calculation

2011

Earnings Per Share JPY

(Net Income - Dividends) / Average outstanding shares

209456 / 804

260.52

Book Value Per Share JPY

Value of Common Equity / No. of Shares Outstanding

63974 / 804

79.57

Current Ratio

Current Assets / Current Liabilities

13073604 / 10686214

1.22

Quick Ratio

(Current Assets - Inventories) / Current Liabilities

11651231 / 10686214

1.09

Debt/Equity

Total Liabilities / Shareholder's Equity

19989564 / 10359723

1.93

Days Sales Outstanding

(Accounts receivable / Total credit sales) x No. of Days

(1886273/18950973) x 365

36.33

Days Inventory

(Inventory / Cost of sales) x 365

(1422373 / 16683797) x 365

31.12

Payables Period

(Accounts Payable / Cost of Sales) x 365

(1956505 / 16683797) x 365

42.80

Receivables Turnover

(Net credit sales / Average accounts receivable)

(18950973 / 1886273)

10.05

Inventory Turnover

Cost of goods sold / Average inventory

16683797 / 1422373

11.73

Net Margin %

Net profit / Revenue

2094561 / 8950973

23.40%

Asset Turnover (Average)

Revenue / Assets

18950973 / 30349287

62.44%

Return on Assets %

Net Income / Total Assets

209456 / 30349287

0.69%

Return on Equity %

Net Income / Shareholder's Equity

209456 / 10359723

2.02%

Return on Invested Capital %

(Net Income - Dividends) / Total Capital

209456 / 12466983

1.68%

Ratios

Calculation

2012

Earnings Per Share JPY

(Net Income - Dividends) / Average outstanding shares

408183 / 2262.65

180.40

Current Ratio

Current Assets / Current Liabilities

11829755 / 10790990

1.10

Quick Ratio

(Current Assets - Inventories) / Current Liabilities

(11829755 - 1304242) / 10790990

0.98

Debt/Equity

Total Liabilities / Shareholder's Equity

19485795 / 10332371

1.89

Days Sales Outstanding

(Accounts receivable / Total credit sales) x No. of Days

1449151 / 18993688

0.08

Days Inventory

(Inventory / Cost of sales) x 365

1304242 / 16615326 x 365

28.65

Payables Period

(Accounts Payable / Cost of Sales) x 365

1503072 / 16615326 x 365

33.02

Receivables Turnover

(Net credit sales / Average accounts receivable)

18993688 / 1503072

12.64

Inventory Turnover

Cost of goods sold / Average inventory

16615326 / 1304242

12.74

Net Margin %

Net profit / Revenue

408183 / 18993688

2.15%

Asset Turnover (Average)

Revenue / Assets

18993688 / 29818166

63.70%

Return on Assets %

Net Income / Total Assets

408183 / 29818166

1.37%

Return on Equity %

Net Income / Shareholder's Equity

408183 / 10332371

3.95%

Return on Invested Capital %

(Net Income - Dividends) / Total Capital

408183 / 12738475

3.20%

Lenders

Lenders provide may either short term or long-term credit to meet your needs. Although there are no universal criteria for certain forms of credit, there are general characteristics of lenders to ...