Calculate gross profit margin and operating profit margin

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Reference no: EM131053979 , Length: word count:1500

ACCOUNTING AND FINANCE Coursework

You are required to prepare an individual written financial analysis of the most recent full financial statements of your allocated company. You may use whatever (legal) techniques and methods you think appropriate and any extra information. The full financial statements may be available on the company Website.

The Financial Times may also be a source of useful information.

There is a word limit of 1,500 words and the issues that I will take into account when marking the assessment will include: setting of the context for the company; arithmetical accuracy; interpretation of the figures; use made of information that is available; structure and eye-appeal of your written report.

1. The company chosen for this assignment is BT Group. Use the last 4 years financial statements to calculate the ratios.

2. Total 13 ratios need to be done for this assignment:

Gross profit margin
Operating/Net Profit margin
ROCE (rate of capital employed)
Trade receivables turnover
Trade payables turnover
Inventory turnover
Current ratio
Acid test ratio
Gearing ratio
Interest cover ratio
Earnings per share
Price to earnings ratio
Dividends cover ratio

3. Competitive analysis needs to be done for the past 2 years. (Sky group)

Coursework Guidance-

-Introduction - What your coursework is about.

i. What does your company do (Background about the comapny)
ii. Where does it do business (National or international)
iii. How does it do business.
iv. Future Prospects (what they intend to do in the future).

- Ratio Analysis (why there is a need) Advantages and Disadvantages.

-Analysis: i) Sections of Ratios:
-what does the ratio stand for?
-formulae
-table with working.
-results.

eg. Net Profit Margin - definition.

Formula = Profit before tax and interest/Sales

- Show the working as an appendix.

- Conclusion - How the company is doing? Ratio Analysis conclusion.

- Use P&L, Balance Sheet and Cash flow, notes on financial Statement, Chairman's statement.

- Compare to competitors with 2 years.

Calculations need to be done in the appendix with all the working shown for 4 years along with competitors ratios analysis

Put it in the report in a table explaining what the ratio is about and how has it changed from the previous years. how this change affects the company performance over the years.

1500 words.

15 references.

Reference no: EM131053979

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