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Analysis/Comparison of Financial Statements

1) What does the numbers tell us?
2) What does the company needs to do about it?
Vermeer's business plan

Income statement 1998 1999

Revenues 36,541 74,079
Gross profit 27,731 56,156

Operating expenses
Payroll 9,820 14,740
contractors fees 35 35
advertising 500 500
recruiting 446 638
medical 635 935
Total opex 12,451 18,059

taxes 6,799 16,588
net income 8,480 20,580
return on sales 23.2 27.8
common shares 6,935 6,935
EPS 1.2 2.97

Solution Preview

The comparison of the financial statements of the two years clearly depict that the company's revenues and gross profit have grown significantly in 1999 as compared to the previous year. Further, the company has also improved significantly on the operating margin front in the sense that company's operating margin was 51% ((Gross Profit-Operating Expenses)/Revenues), as compared to ...

Solution Summary

The comparison of the financial statements of the two years clearly depict that the company's revenues.

$2.19