Running Head: FINANCIAL RATIOS 1 FINANCIAL RATIOS 5 FINANCIAL RATIOS Shawn Harden Southern Wesleyan University Managerial Finance Apple Financial Analysis On this assignment, we cover the financial analysis of Apple incorporated company. The analysis is done by the use of financial ratios. Apple is a company that provides the customer with various products such as mobile phones, tablets, laptops, software and other music digital players. The company is based in the United States but has customer all over the world. The company is among the best in the industry. Liquidity Ratios 2014 2015 Current Ratio 1.08 1.11 Quick Ratio 0.86 0.98 Liquidity ratios are ratios that are used to determine the ability of a company to pay back its liabilities. The liquidity of the company can be determined by using current ratios and quick ratios. The current ratio is determined by making a comparison of current assets to current liabilities. This ratio is meant to determine the liquidity and efficiency of the company. The ratios of the company show that the company can comfortably pay its outstanding debt using its current assets. The company therefore has a big margin and can therefore be able to pay the debt and any more debt. The company has a good liquidity due to the fact that their sales have increased which makes the liquid cash increase to and the current assets to also increase (Titman, Keown & Martin, 2015). Quick ratio determines the liquidity of the company using the most liquid assets that it has. The most liquid assets in this case are cash and cash equivalents. The two ratios above show that the company cannot be able to pay all of its debts using the most liquid assets. The company can therefore not be able to pay of all its debts in case of a situation where it should be paid within a short period of time. The company however has a better quick ratio in comparison to the industry’s average. The quick ratio improved from 2014 to 2015 due to the fact that the company had an increase in its sales thus an increase in accounts receivable and cash. Asset turnover ratios 2014 2015 Inventory Turnover 53.2 59.6 Collection Period 34.9 26.3 Asset turnover ratio draws a comparison between the company’s revenues and the company’s assets. The asset turnover ratio is used to determine the efficiency of the company in using its assets to generate revenues. Inventory turnover determines the number of times the company consumes all of its inventory and replaces it within an accounting period. The company had high numbers of inventory turnover. This therefore shows that the company has low costs for storage since they take the company take low levels of inventory at a time. This shows that the company has an efficiency in the way it uses its assets. The company buys low level of inventory so that the company has more cash left to carry out other investments. The level of asset turnover is good if the company does not a ...

1. Running Head: FINANCIAL RATIOS
1
FINANCIAL RATIOS
5
FINANCIAL RATIOS
Shawn Harden
Southern Wesleyan University
Managerial Finance
Apple Financial Analysis
On this assignment, we cover the financial analysis of Apple
incorporated company. The analysis is done by the use of
financial ratios. Apple is a company that provides the customer
with various products such as mobile phones, tablets, laptops,
software and other music digital players. The company is based

2. in the United States but has customer all over the world. The
company is among the best in the industry.
Liquidity Ratios
2014
2015
Current Ratio
1.08
1.11
Quick Ratio
0.86
0.98
Liquidity ratios are ratios that are used to determine the ability
of a company to pay back its liabilities. The liquidity of the
company can be determined by using current ratios and quick
ratios. The current ratio is determined by making a comparison
of current assets to current liabilities.
This ratio is meant to determine the liquidity and efficiency of
the company. The ratios of the company show that the company
can comfortably pay its outstanding debt using its current
assets. The company therefore has a big margin and can
therefore be able to pay the debt and any more debt. The
company has a good liquidity due to the fact that their sales
have increased which makes the liquid cash increase to and the
current assets to also increase (Titman, Keown & Martin, 2015).
Quick ratio determines the liquidity of the company using the
most liquid assets that it has. The most liquid assets in this case
are cash and cash equivalents. The two ratios above show that
the company cannot be able to pay all of its debts using the
most liquid assets. The company can therefore not be able to
pay of all its debts in case of a situation where it should be paid
within a short period of time. The company however has a better
quick ratio in comparison to the industry’s average. The quick
ratio improved from 2014 to 2015 due to the fact that the
company had an increase in its sales thus an increase in
accounts receivable and cash.

3. Asset turnover ratios
2014
2015
Inventory Turnover
53.2
59.6
Collection Period
34.9
26.3
Asset turnover ratio draws a comparison between the company’s
revenues and the company’s assets. The asset turnover ratio is
used to determine the efficiency of the company in using its
assets to generate revenues. Inventory turnover determines the
number of times the company consumes all of its inventory and
replaces it within an accounting period. The company had high
numbers of inventory turnover.
This therefore shows that the company has low costs for storage
since they take the company take low levels of inventory at a
time. This shows that the company has an efficiency in the way
it uses its assets. The company buys low level of inventory so
that the company has more cash left to carry out other
investments. The level of asset turnover is good if the company
does not at any time have zero inventory that can cause the
company to cause delays to the customers.
Collection period is used to determine the account receivable
turnover. This is the average number of days it takes for the
company to receive its account receivable. The company has a
collection period of 34 days in 2014 and 26 days in 2015. This
therefore shows that the company takes a considerable time for
it to receive the debts owed to them. The company however
reduced the period of time in 2015 which might show that the
company has carried out activities that are meant to improve the
time that they take to collect their account receivable (Spronk,
Steuer & Zopounidis, 2016).
Profitability Ratios

4. 2014
2015
Return on Equity (ROE)
35%
44%
Return on Assets (ROA)
17%
18%
Net Profit Margin
21.56(
23.08(
The company has a high return on equity of 44%. This therefore
shows that the company is making good use of the equity it
receives from the shareholders to make profit. The company is
also making good use of its assets to make profits. The net
profit margin that it has is also very good. The profitability can
be attributed on the fact that the company has produced new
products that have increased the sales that have consequently
improves its profitability.
Conclusion
The company is performing well and has a good financial
health. The company is performing well in term of the
profitability. All of the profitability ratios shows that the
company is making good profits. The company is also making
good use of the assets that it has to make profits. The
company’s liquidity is also good in that it can comfortably pay
of its debts with the asset that it has. The company is therefore
in very good financial health.
References
Spronk, J., Steuer, R. E., & Zopounidis, C. (2016). Multicriteria
decision aid/analysis in finance. In Multiple Criteria Decision
Analysis (pp. 1011-1065). Springer New York.
Titman, S., Keown, A. J., & Martin, J. D. (2015). Financial
management: Principles and applications. Pearson.

5. Pg.04
[Research Proposal The Political, social and Health
Construction of Homosexuality]
Homosexuality is seen by most as a deviance to the social
values and beliefs. This attitude has propagated the
marginalization of this group in social, political and religious
aspects. This research shall be exploring the religious, political
and health care obstacles facing the homosexual community.
This topic is of interest because society at any one time cannot
be fit in to a one- size- fits- all. There will always be variations
and for it to work as a well-oiled machine sensitive matters like
homosexuality have to be addressed.
In Western Europe since 1989, there has been a spread of
formalized same-sex couples when the institution of marriage
has always been heterosexual.

6. This proposal will mainly focus on three secondary sources
touching on these issues affecting homosexuals. It shall review
the works of this research proposal will address two questions
that will inform my preliminary research:
· How are religious groups working towards embracing the
homosexuals with their principles being based on compassion
for all?
· What are the political and health care stakeholders doing to
protect the rights and lives of homosexuals who are part and
parcel of our community?
The secondary sources I shall be using to answer the above
questions are three books:
· First, a book by David R. Hodge titled “Epistemological
Frameworks, Homosexuality, and Religion: How People of Faith
Understand the Intersection between Homosexuality and
Religion”, published July 2005.This book is a helpful tool in
answering the question of how religious groups will extend
support to homosexuals. In summary this book addresses how
both people of faith and homosexuals both feel marginalized by
the other and how it affects social works. It addresses how both
these groups should embrace inclusivity for the good of society.
· The second book is by Achim Hildebrandt titled, “Christianity,
Islam and Modernity: Explaining Prohibitions on
Homosexuality in UN Member states.” It was published in
2014.It addresses the legality of same –sex groups and how 77
countries have banned them based on religious roots. This
addresses the question of how the political frameworks of UN
member states have affected how homosexuals lead their lives.
· The third book is by Andrew Moores, J.Craig Philips, Patrick
O’Byrne and Paul McPherson titled “Anal Screening
Knowledge, attitudes and experiences among men who have sex
with men in Ottawa Ontario.”It was published in 2015. It
addresses the health question of how homosexuals approach
their health matters. It talks about anal cancer which is rare but
has become prevalent among homosexuals and the challenges
they face in addressing it due to lack of programs or standards

7. of care informing primary care physicians.
People with same-sex orientation, more so, homosexuals should
be given access to quality health care system that provides a
non-hostile environment so they can be more forthcoming about
health related complications.
People of faith and homosexuals should work together on the
basis of inclusivity to curb marginalization and to strengthen
social works and on the same point governments should review
the legalities they place on homosexuals based on their religious
roots.
This proposal highlights the experiences of the homosexual
community. They face challenges in legally, religiously and
health wise and this proposal addresses these issues. This group
easily identifies with these issues because statistics say so and
my observations. The thesis statements correspond to the core
of the homosexual community way of life.
In conclusion, the next step of interest is the freedom of
homosexuals in the army. If a person reveals that they are gay
will they ostracized by being discharged from duty or being
subjected to tougher work conditions? It will involve carrying
out a research on army recruitment statistics among the
homosexuals. In my next visit to the library, I would like to be
more focusing on the homosexuals’ life and their effects from
all the side.
Sexuality issues in the Society: Abstract
After the same-sex marriage law was passed, individuals who
had been hiding their relations from the public acquired the
confidence to publicly proceed on with their relationship. There
are however many beliefs and perspectives that make the
majority of these people maintain the secrecy of how they relate
with one another. The main reason is that the society has not yet

8. completely accepted the concept of same-sex marriage. The
church, for example, is still against this societal aspect. These
issues therefore significantly affect the same sex community,
mainly because despite the legality of the matter according to
the law, the perspectives of others, which matters to most
individuals, are still negative. This area is thus appropriate for
study, because, through it, one can fully understand the
different ways through which the same-sex community is
affected by different perspectives of individuals and groups in
the society. The purpose of this study, therefore, is to highlight
how society’s perceptions and attitudes in matters of faith,
health issues and political ideologies affect the homosexual
community. It draws on three secondary sources to expose the
underlying issues facing homosexuals: a) “Epistemological
Frameworks, Homosexuality, and Religion: How People of Faith
Understand the Intersection between Homosexuality and
Religion” by David R. Hodge,b) "Christianity, Islam, and
Modernity: Explaining Prohibitions on Homosexuality in the
UN Member States." by Achim Hildebrandt and c) “Anal
Screening Knowledge, attitudes and experiences among men
who have sex with men in Ottawa Ontario” by Andrew Moores,
J.Craig Philips, Patrick O’Byrne and Paul McPherson. The
anticipated outcome of this study is to bridge the gap between
people with different sexual orientation so as to handle better
the challenges faced as a society from a unified front.

9. References
The Political, Social and Health Construction of
Homosexuality. Research Proposal.
Hodge.D.R. (2005).National Association of Social Work.
Epistemological Frameworks, Homosexuality and Religion:
How people of faith understand the intersection between
Homosexuality and Religion.
Moores,A.,Philips,J.C.,O’Byrne,P.,&McPherson,P.(2015).Anal
cancer screening knowledge, attitudes and experiences among
men who have sex with men in Ottawa Ontario. Ontario ON:
University of Ottawa.
My research question: This research shall be exploring the
religious, political and health care obstacles facing the
homosexual community.
Source 1
Academic search primer ( databases) + Books
Source 2
Academic search primer ( databases)
Source 3
Academic search primer ( databases)
Source 4
The Political, social, and health construction of Homosexuality.

10. Research Proposal
Main Idea 1
How people of faith understand the intersection between
Homosexuality and Religion.
Anal cancer screening knowledge, attitudes and experiences
among men who have sex with men.
Christianity, Islam and Modernity: Explaining
Prohibitions on Homosexuality in UN
Member States.
how society’s perceptions and attitudes in matters of faith,
health issues and political ideologies affect the homosexual
community
Main Idea 2
How religious groups will extend support to homosexuals. So
like in Islam or modernity religion they addressed the legality
of the same sex and they banned them.
Homosexuals should be given access to quality health care
system that provides a non-hostile environment.
The main idea for this article investigates why homosexual acts
are still banned in 77 countries.
the prejudices against homosexuals on the basis of religion,
health and political ideologies in a mostly heterosexual society
Main Idea 3
How the political frameworks of UN member states have
affected how homosexuals lead their lives.
As we know make a relationship between same sex it will make
a dresses for example it cause Anal cancer.In addition,
homosexual they should check for the health care.

11. Previous studies have analyzed the influence of Islam on
prohibitions
Of same-sex sexual acts but produced contradictory findings.
Bridge the gap between people with different sexual orientation
so as to better handle challenges faced as a society from a
unified front.
Adapted from NC State University Writing and Speaking
Tutorial Service, Writing A Literature Review and
Using a Synthesis Matrix. 2006. Retrieved June 26, 2013 from
http://www.ncsu.edu/tutorial_center/writespeak/download/Synth
esis.pdf
BOND AND STOCK ANALYSIS OF FORD MOTOR
COMPANY
BOND
AUTOMOTIVE SECTOR
$(MILLIONS)
INTEREST RATE
effective i.r
Shorterm
1779
7.3%
7.3%
longterm

12. 11060
5.3%
6.0%
FINANCIAL SERVICES SECTOR
Shorterm
12123
1.6%
1.6%
longterm
107892
2.3%
2.4%
$ 132,854
Moody's Investors Service upgraded the long-term ratings of
Ford Motor Company (Ford) and Ford Motor Credit Company
(Ford Credit) to Baa2 from Baa3. In addition, the short-term
rating of Ford Credit is upgraded to Prime-2 from Prime-3. The
outlook for both companies is stable.

13. Approximate interest rate
357684.3
2.69%
financial leverage
.=total debt/total equity
in millions
total shareholders equity=
$ 28,642.00
total debt
$ 132,854

14. leverage
4.63843307
The high leverage ratio is mainly as a result of its financial
services sector of the ford motor company
The Leverage ratio of Ford motor company is very high since it
4.63 meaning for every 1 unit of equity used in the company it
in turn uses 4.63 units of debt to finance its activities
INTEREST PAYMENTS TO TOTAL REVENUE ANALYSIS
motor sector
interest expense
773

15. Earnings Before Interest and tax
6023
Interest covereage ratio
7.79
financial services sector
interest expense
2454
Earnings before interest and tax
8992
Inteerest Coverage ratio
3.66
STOCKS

16. market price,
11.76
book price
=)TOTAL ASSETS-TOTAL LIABILITIES)/OUTSTANDING
SHARES
=(224925-196174)/3960
7.26
forecasted price.
FAIR PRICE- INTRINSIC VALUE
$22.6
ANALYSIS.
From the information on Ford Motor Company bonds we can
conclude that from its bond that of its two divisions that is the
motor division and the financial services division, the financial
services division contributes a huge chunk of the overall bond
of the company.
The short-term debt in the motor division is $1779 million
while the long term debt is $11,060 million which clearly shows

17. that the motor division prefers using long term debt compared
to short term debt. The effective interest rate of the short –term
debt is 7.3% which is much higher than the 6% charged for long
term debt. Long term debt is thus cheaper to use than short-term
debt.
On the other hand in the financial services division is $12,123
million while the long term debt is $107,892million which
clearly shows that the motor division prefers using long term
debt compared to short term debt. The effective interest rate of
the short –term debt is 1.6% which is much lower than the 2.4%
charged for long term debt. In the financial services division it
is much cheaper to use short term debt compared to long term
debt.
From comparison of the interest rates charged on the motor and
financial services division the debt used by the motor division
is more expensive than the debt used by the financial services
division.
The credit rating of the Ford Motor company indicates a Baa2
(Moodys, 2016). This means that Ford Motor Company has
sufficient capability to fulfil its financial obligations when they
fall due. Nevertheless, unfavorable economic conditions or
shifting circumstances have a very probability to cause a
weakening in the capacity of the company to fulfil its financial
obligations when they fall due.
On comparison of the two division’s interest payments it was
found out that the interest coverage ratio of the motor division
was 7.79 meaning that the motor division can cover the interest
payments 7.79 times from its earnings. However the financial
services division has an interest coverage ratio of 3.36 which is
much lower than the motor division meaning that it can only
cover its interest payment obligations by 3.66 times.
The leverage to equity ratio of Ford motor company is 4.63
which means for every one unit of equity used to finance the
company 4.63 units of debt are also used. We can conclude
therefore that the financial services sector is more heavily
leveraged compared to the motor division.

18. The current market price of the Ford Motor Company share is
$11.76 (Financial Times, 2016) this is as at the close of
business on 18th November 2016 at the New York Stock
Exchange. When this is compared to the book price which is
obtained by deducting the total liabilities from the total assets
then sharing out that amount among all outstanding shares the
value arrived at is $7.26 per share. Which is much lower than
its market price. This shows that the Ford motor Company is
more valuable when in operations than if it was liquidated and
its net proceeds shared out among its shareholders. The fair
market value has been arrived at $22.6. Which is the intrinsic
value of the share which is the discounting of all future cash
flows related to the Ford Motor Company share in form of
dividend. The share is therefore undervalued in the current
market.
IMPLICATION OF THE STUDY
1.Ford Motor Company is heavily leveraged and should strive to
reduce its debt financing in its financial services division. The
heavy leverage negatively affects its credit rating since a big
percentage of its earnings are used to service debts payments
which if not met could drive it to bankruptcy.
2. The Ford Motor Company stock is undervalued in the market
and I would recommend that an investor can either hold on to
the stock or accumulate more shares until the share is correctly
valued by the market forces.

19. .
References
Financial Times. (2016, November 18). Financial times.
Retrieved from Equities:
https://markets.ft.com/data/equities/tearsheet/forecasts?s=F:NY
Q
Moodys. (2016, February 16). Moody's upgrades Ford and Ford
Credit long-term ratings to Baa2 from Baa3; outlook is stable.
Retrieved from Moodys Investor Services:
https://www.moodys.com/research/Moodys-upgrades-Ford-and-
Ford-Credit-long-term-ratings-to--PR_343854