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Financial and operational health perspective

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Reference no: EM133272741

A corporation has the following financial data: (i) Sales of Rp. 100 billion, (ii) COGS of Rp. 40 billion, (iii) Operating & Managerial expenses of Rp. 10 billion, (iv) Interest expenses of Rp. 1.5 billion, (v) Assets of Rp. 600 billion [60 % is fixed assets], and (vi) Liabilities Rp450 billion [80% is current liabilities]. The applicable income tax rate is 15%. The beta of this corporation is 0.5 with a market return of 6%. Currently, the yield on 10-year government bonds is 7%, while this corporation has a bond yield of 4% above the yield on government bonds.

Question : Structurally (DuPont analysis), how do you analyze the financial statements of this company from a financial and operational health perspective. What is your brief recommendation to improve the company's financial condition?

Reference no: EM133272741

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