Ratio Analysis Case Study Example | Topics and Well Written Essays - 1000 words

balance Analysis - Case Study ExampleThis paper will shed light upon the financial symmetrys of apple, how the fraternity will fare in the future will also be comprehensively analyzed. ROI stands for return on investment, orchard apple trees ROI matches DELL which is great news for the high society, return on investment goes to learn that the products demand been selling truly well in the market. The sales growth of Apple has also seen a satisfying rise in the last quarter, all these are indicators that the company is performing really well. Steve Jobs, the CEO of Apple has been coming up with strategies to promote the products, even though he has had severe health issues, he has been actually successful in building the brand name of Apple. Apple has also managed to diversify which is again very good for the business, the company is not dependent on only one product but they prevail a plethora of products which arsehole be relied upon, this has reduced the risk for the c ompany. Apple operates on a very much(prenominal) higher gross margin than other companies, Gross margin of 29.02% is the margin that the company operates at, this goes to show that the company has adopted a higher selling price mix. Products like iMac and Ipads have really given Apple an edge and this is why the company can afford to set higher prices for their products. Apple spends 3.8% on inquiry which is very good for the company, perhaps this percentage can be improved so that they can produce new and better products. The operating expenses are about 13.38% which goes to show that the company is very stable and investors can invest in this company. The working capital of the company is very healthy it is again because of the profits. The current ratio of the company stands at 2.96 (Million) which means the company can easily pay off short depotination debt not once, not twice but thrice. This is a very strong position to be in Apple has no need to take loans because it can easily pay off debt. Acid-test ratio goes to show how quickly assets can be converted into liquid cash, Apple has an edge once again and this is barely surprising. The acid-ratio of the company stands at 2.63 which signify the operating efficiencies of the company give it a huge edge all over other companies. Assets turnover ratio stands at 1.42, this means the sales of the company has been picking up, and this ratio is derived by dividing the sales by assets. The ratio is also an indicator of how assets are used to generate profits. Apple has been doing it very successfully thus far. This tells us something about Apples pricing strategy. The Profit Margin for a product is the net of sales deduct the cost of goods sold. Therefore, Apple has higher pricing aerated to its products whirl as compared to that of Dells, even though Dells Inventory Turnover Ratio is much higher in this case. But looking at Dells turnover ratio on Net Sales it is close to that of Cost of Goods Sold, therefore this also explained that Dell has lower pricing charged to its products offerings. (Inventory Turnover Ratio) Debt ratio of the company stands at 0.35 which means that there are still some debts which should be cleared this is not a problem especially when the company is performing so well in the market. The company can easily clear this debt off whenever they want to, this is not an issue for them. The debt/equity ratio of the company is extremely healthy, it stands at 0.55, this goes to show that the equity has been well managed to pay off short term