The goal of this assignment is to identify the industries of ten columns of financial data by comparing the financial ratios and financial information to industry norms. In the following paragraphs we will identify each column, providing the SIC code and industry name, the reasons upon which our match is based, and the sources we used to come to these conclusions.
Column A
We believe that column A is a company associated with the Malt Beverage industry (SIC Code 2082). Our conclusion is based on financial ratios found in Industry Norms and Key Business Ratios. Two main ratios which lead us to this conclusion are the Current Ratio (1.19 for the unidentified industry versus 1.4 for the industry average) and the Quick Ratio (.72 for the unidentified industry versus .8 for the industry average). We also found that the percentages for inventory (10.2% for Column A versus 11.7% for the industry), accounts receivables (9.9% for Column A versus 14.4% for the industry), accounts payable (7.9% for Column A versus 8.5% for the industry), and long-term debt (a combined 34.4% for Column A versus 30.5% for the industry) were within industry norms. We expected the Malt Beverage industry to have a rather low net profit margin, as this industry is more likely to make profit on volume rather than on per-item sales. The industry average net profit is 5.4% versus 4.7% for Column A. Fixed assets for Column A also fit with industry norms, Column A having 39% of its assets in property, plant and equipment versus 50.2% for the industry. We are very confident that based on the above information, Column A must be associated with the Malt Beverage industry.
Column B
We chose Scheduled Air Transportation (SIC 4512) as the industry for Colum ...