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Stilsim Financial Ratio Analysis Paper

1166 Words5 Pages

https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&ved=0ahUKEwioi_C6q7vSAhUIxoMKHcPBDpUQFggcMAE&url=https%3A%2F%2Fycharts.com%2Fglossary%2Fterms%2Fcash_ratio&usg=AFQjCNGlNOT31RFRLjPt-g2GOmIHIAhoBw&sig2=Oio6RuEGWBeWlcg0prXA8gIt is essential to complete an internal financial ratio analysis of StilSim. The analysis will evaluate the performance of StilSim and compare it to a competitor. The competitor that will be used in this analysis is StaffAces. A financial ratio analysis is a technique for measuring the performance of an organization according to the organization’s balance sheet, income statement, and market value (Dess, McNamara, & Eisner, 2016, p. 97). To complete an analysis of the financial performance of an organization …show more content…

The current ratio is a strength and a weakness for Stilman. It shows that StilSim has the ability to pay it short term debt but it also is a weakness. A high ration indicates an inefficient use of cash and other short-term assets (Dess, McNamara, & Eisner, 2016, p. 445). In 2016, StilSim has over $3 million in assets with only $896,828 in liabilities. This cash flow could be used to improve the organization technology. The below chart shows the current ratio for StilSim and StaffAces. When comparing the current ratio of the two companies you see that StaffAces is growing their company by using their assets. StaffAces current ratio has remained even through the years as they invest their assets into the company. StilSim is not using their assets. A company must be willing to spend to support the future of the …show more content…

To calculate the total debt ratio for StilSim’s the total assets minus total equity is divided by total assets (Dess, McNamara, & Eisner, 2016, p. 444). The result shows the percentage of debt of the company. StilSim’s total debt ratio start at .12 in 2011 and ended at .23 is 2016. Staff Aces total debt ratio started at .45 in 2011 and ended at .45 in 2015 (Franklin University, 2013). The total debt ratio is showing that for every $0.23 that StilSim has in debt they have $1.00 in assets to cover it. Staff Aces total debt ratio is showing that for every $0.45 in debt they have $1.00 in assets to cover the

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