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  • krp67 replied to the topic Discussion Topic: Exercise your research skills in the forum Business 101 6 years, 5 months ago

    I choose Merck for the financial assessment: I found these results base doff Yahoo financial page for companies.
    Doing a brief financially assessment off 2016 since some data isn’t up for 2017 yet.
    Income Sheet:
    Gross Profit : 26,444,000
    Net Income : 3,920,000

    Balance Sheet:
    Total Assets: 95,377,000
    Total Current Assets: 30,614,000
    Total Liabilities: 50,069,000
    Total Current Liabilities: 17,204,000
    Net Tangible Assets: 4,621,000

    Cash flow Sheet:
    Net Income: 10,376,000
    Total Cash Flows From Financing Activities -9,044,000

    Current Ratio = Current Assets/Current Liabilities = 30,614,000/17,204,000 = 1.77
    Debt Ratio = Total Liabilities/Total Assets = 50,069,000/95,377,000 = 0.52

    The health of the company as of 2016 seems to be good. The Current Ratio is above 1 which means they keep acquiring assets to help the company. For the debt ratio its below 1 going by a 0-1 scale its good as well. If that ratio was above 1 then I would assume the company is exceeding what it can financially handle.