Assignment: Evaluate Financial Ratios to Differentiate Profitability and Liquidity across Organizations
Scenario
A presidential election year is on the horizon. Control of the White House may shift political parties. Whenever there is potential for a shift in political parties, defense spending could end up being reduced. You are presently a support analyst for a financial fund administrator with an extensive amount of money invested in the Boeing Corporation, a publicly traded company. Part of Boeing's operations are in defense contracting, such as the manufacturing of military aircraft and helicopters. You must evaluate the current stability of Boeing to determine whether to recommend moving money from this investment to another investment.
Instructions
Write a management report to your fund administrator that:
1) Explains the different liquidity, profitability, and solvency ratios that are used to assess the financial health of a corporation.
2) Computes the liquidity, profitability, and solvency ratios using the 2018 Boeing Corporation's financial statements.
3) Computes the liquidity, profitability, and solvency ratios of Airbus, a passenger plane competitor, using the 2018 financial statements.
4) Compares and contrasts the financial ratios of Boeing and Airbus.
5) Provides a recommendation, supported by the ratio calculations, as to whether you believe Boeing is stable enough compared to the competitor that if defense funding is reduced, the company will continue to prosper.
Format your assignment according to the following formatting requirements:
(1) The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
(2) The response also includes a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
(3) Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.