This Learning Activity involves preparing a preliminary financial analysis of one of the largest firms in the world, McDonalds Corporation.
Locate the annual reports (10-K) of McDonalds (MCD) for the most recent three years reported.
For this assignment, do NOT use the Dupont Method (if applicable).
Using the financial statements, calculate and analyze the following financial ratios for McDonalds for the most recent three years reported:
Profit Margin
Return on Assets
Return on Equity
Debt to Total Assets
Times Interest Earned
Current Ratio
Quick Ratio
Present your ratios first. Then, analyze each ratio trend. The analysis should address the following questions:
Is the ratio trend increasing or decreasing?
Why is there an increasing trend or a decreasing trend?
Is this trend favorable or unfavorable? Why?
What might the firm do to change the ratio?