Acc 561 - American Corporation Analysis
Autor: rmejia173 • November 24, 2015 • Research Paper • 1,277 Words (6 Pages) • 1,332 Views
American Corporation Analysis
ACC/561
American Corporation Analysis
The basis of financial analysis is to provide a clear prospective on the financial structure of a business organization. Embedded within financial analysis is the process of identifying the financial strengths and weaknesses of the firm by utilizing important tools such as the income statement, statement of stockholders equity, balance sheet, and the statement of cash flows. Such analysis is conducted for The Hershey Company.
Horizontal Analysis
The followings are the horizontal analysis for The Hershey Company (in thousands) for the fiscal year ended in December 31, 2014. There are some negative changes between the two years due to 5.7 percent higher cost of sales, 144 percent higher business realignment expenses, 6.56 percent higher provision for income tax, and also significant changes in the balance sheet numbers due to an acquisition and $250,000,000 portion of long term debt due. However, the increase of 3.86 percent in net sales in the amount of $275,689,000 is high enough to make Hershey have a positive year. The change in net income for the fiscal year ended in December 31, 2014 is a positive $26,442,000 or 3.22 percent increase. Hershey manages to increase net income in the two years that was analyzed, while still selling a company with expected loss and making strategic acquisition for future growth.
Balance Sheet Horizontal Analysis
December 31, 2014 2013
ASSETS Variance
Current Assets: Amount Percentage
Cash and cash equivalents $ 374,854 1,118,508 $ -743,654 -66.49%
Short-term investments 97,131 97,131 0.00%
Accounts receivable - trade, net 596,940 477,912 119,028 24.91%
Inventories 801,036 659,541 141,495 21.45%
Deferred income taxes 100,515 52,511 48,004 91.42%
Prepaid expenses and other 276,571 178,862 97,709 54.63%
Total Current Assets 2,247,047 2,487,334 -240,287 -9.66%
Property, plant and equipment 2,151,901 1,805,345 346,556 19.20%
Goodwill 792,955 576,561 216,394 37.53%
Other intangibles 294,841 195,244 99,597 51.01%
Other
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