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"Analysis of Financial Statements "Simulation
Analysis of Financial Statements of Lambda TV and CORAL
Panorama Inc is America's second largest manufacturer of computers and peripherals. Panorama's latest innovation is the PanBox, which is a set-top box that enables a television set to become a user interface to the Internet and receive digital broadcasts. Panorama's short-term goal is to sell PanBox along with televisions. Their long-term goal is to make PanBox the focus of convergence. To meet these goals, Panorama decided to enter into a joint venture with a television manufacturing and marketing firm. The company CFO Simon Finkel has short-listed two television companies, Lamda TV and CORAL. Panorama used two financial ratio analysis suites Stuart Mason and Wagner. We need to choose the suite that is better suited for evaluating the financials of Lambda TV and Coral. Panorama has some expectations from the alliance partner. The Company's management feels that the alliance partner should have sales growth that is on par with or greater than the industry averages (simulation). The Wagner suite evaluates firm's financial ratios under five categories: sales growth, profitability, turnover, liquidity, and capital structure.
Sales Growth
Sales is defined as "the exchange of goods or services for an amount of money or its equivalent; the act of selling" (dictionary, 2005, sales). The Wagner suite analysis has high weights for sales growth and profitability. Sales growth indicates the company's strength and stability. Stuart Mason one of the financial ratio analyses does not look at Sales growth. Since ...