Purchase Solution

Interpreting Ratios

Not what you're looking for?

Ask Custom Question

Please analyze the attached data. Include in report the answers to the below questions.

What can be concluded from the ratios?
Does the data show any warning signs?
Does anything stand out in the data?

Attachments
Purchase this Solution
Solution Summary

This solution reveals what can be concluded about a data set of Southwest Airlines ratios. The solution also highlights the warning signs identified in the ratios. Lastly, the solution highlights the issues that stand out in the data.

Solution Preview

Conclusions from the ratios

(1) Liquidity ratios - both the current ratio and the quick ratio reveal that Southwest Airlines' ability to meets its short-term financial obligations has been declining. The company was in a better liquidity position in 2012, but its ability to pay its short-term debts using its short term assets weakened in 2013 and 2014. Additionally, the company's liquidity position is weaker than its competitors'.

(2) Asset management ratios - the company's efficiency in selling its inventory has improved, but it still ranks lower than competitors. Additionally, Southwest efficiency in collecting revenue declined year-on-year. The company's ability to use assets to generate revenue improved significantly in 2013 ...

Purchase this Solution
Free BrainMass Quizzes
Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

View More Free Quizzes
Related BrainMass Solutions

  • Financial Statement Analysis - Profitability

    4.14 Calculating and Interpreting Accounts Receivable and Inventory Turnover Ratios ? 4.15 Calculating and Interpreting Fixed Asset Turnover Ratios ?

  • Southwest Airlines Financial Ratio Analysis: 2007-2010

    383709 Southwest Airlines Financial Ratio Analysis: 2007-2010 Evaluate Southwest Airlines financial performance by calculating and interpreting the profitability ratios.

  • Interpreting Financial Statements: Computing Probability Ratios

    The solution assists in interpreting financial statements and computing probability ratios.

  • Ratios for Investors and Managers

    Interpreting financial statements and alternative theoretical perspectives. In Accounting for managers: Interpreting accounting information for decision-making (2nd ed., pp. 87-106). West Sussex, England: John Wiley & Sons, Inc.

  • Ratio analysis of Yahoo

    Prepare a one-page memo interpreting and summarizing your findings on the ratios. Give your conclusions about any changes that occurred from year-to-year. What corrective actions would you recommend based on the ratio analysis and why?

  • Financial Interpreting Coca-Cola and PepsiCo

    271910 Financial Interpreting Coca-Cola and PepsiCo INTERPRETING FINANCIAL STATEMENTS BYP13-4 The Coca-Cola Company and PepsiCo, Inc. provide refreshments to every corner of the world.

  • Financial Analysis of Raytheon

    For each ratio calculated, write a paragraph interpreting the trends and identify strengths and weaknesses. Write a paragraph intrepreting the trends... for the 4 financial ratios you are working on. e.

  • Case Study for Southwest Airlines.

    Evaluate the company's financial performance by calculating and interpreting the profitability ratios. (operating profit margin, net profit margin, return on total assets, return stockholders equity).

  • INTERPRETING FINANCIAL STATEMENTS/liquidity ratios/profitabi

    48339 INTERPRETING FINANCIAL STATEMENTS/liquidity ratios/profitability ratios BYP4-10 Manitowoc Company and Caterpillar Corporation are both producers and sellers of large fixed assets. Caterpillar is substantially larger than Manitowoc.

  • Calculating and interpreting financial ratios

    560831 Calculating and interpreting financial ratios using financial statements Give me a starting point on using the sample financial statements attached, calculate the financial ratios and then interpret those results against historical data and industry

View More Related Solutions