A.) Horizontal and Vertical Analysis (Omnibus Bio-Medical Systems Inc)
A.) Horizontal and Vertical Analysis (Omnibus Bio-Medical Systems Inc)
HORIZONTAL VERTICAL
2015 2014
Amount Percentage 2015 2014
DISTRIBUTION COSTS/SELLING
EXPENSES 1,963,063 1,416,055 547,008 38.63% 1.56% 1.51%
ADMINISTRATIVE EXPENSES 12,793,514 11,871,555 921,959 7.77% 10.18% 12.62%
HORIZONTAL VERTICAL
2015 2014
Amount Percentage 2015 2014
NET INCOME FROM OPERATIONS 10,074,744 8,910,221 1,164,523 13.07% 7.46% 7.49%
Interests & bank charges (1,203,688) (1,197,829) -5,859 0.49% -0.89% -1.01%
Interests earned 9,859 8,679 1,180 13.60% 0.01% 0.01%
(1,193,829)
NET INCOME BEFORE INCOME TAX 8,880,915 7,721,071 1,159,844 15.02% 6.58% 6.49%
PROVISION FOR INCOME TAX 2,662,870 2,315,085 347,785 15.02% 1.97% 1.95%
NET INCOME AFTER INCOME TAX 6,218,044.60 5,405,985.62 812,059 15.02% 4.60% 4.55%
6.) Return on total assets Net income after tax 0.48% 0.42% Measure the of the return of total
Total Assets (BS) investment in the firm. Indicate
ineffective assets employed by the
management.
Return on Net income after tax
7.) 2.07% 2.04% Measure the percentage of
Stockholders Equity Total Stockholders' Equity income for every peso of
owner’s equity. Poor status.
Earning per share Net income after tax Measures the rate of
8.) 0.0429 0.0413 earnings per share of
No. of common shares outstanding (BS)
common stock. Indicate low
return
Book value per share Indicate the value of the stock on
Stockholders equity's 2.07 2.03
9.) the perspective, the relevance of
No. of common shares outstanding (BS) this ratio diminishes when the
balance sheet valuation does not
approach market values.
Price per share Its show how may times the
10.) Price/Earnings ratio 48.29 49.14 annual earnings the present
Earning per share shareholders are willing to pay
to get the share.
C SOLVENCY RATIOS
1.) Current ratio 3.19 2.89 Ability to cover short term debt
as it comes due. Firms ratio is
stable more than the ideal 2:1
Firm's ratio is very stable to cover
2.) Quick ratio 2.83 2.52
the current due.
3.) Receivables turnover 6.40 6.61 Measure average length of time
it takes the firm’s to collect the
sales made on credit. Status is
strong
Collection period 57.07 55.24 Indicate the average length of
the firm must wait after making a
sale before it receives payment
Ideal ratio is at least 8 times indicate
4.) Inventory turnover 40.47 36.67 good turn over not overstocking as
for trading business line. Strong
status.
6.) Return on total assets 10.24% 9.88% Measure the return of total investment
in the firm. Indicate effective assets
employed by the management.
8.) Earning per share 34.54 30.03 Measures the rate of earnings per
share of common stock. Indicate
high return
Indicate the value of the stock on the
9.) Book value per share 254.17 222.44 perspective, the relevance of this ratio
diminishes when the balance sheet valuation
does not approach market values.
10.) Price/Earnings ratio 7.36 7.41 Its show how many times the annual
earnings the present shareholders are
willing to pay to get the shares.
C SOLVENCY RATIOS
12.) Debt to Equity 0.33 0.37 Firm’s ability to pay its long term
creditor are stable and strong
financial structure.
Firm's amount of resources provide
13.) Equity to Assets 0.75 0.73 by owners is high. Indication of
strong solvency.
Firm ability to pay its interest
14.) Times interest earned 8.37 7.44
when due is very stable.
Best Alternative Course of action based on consolidated table analysis is Dakila Trading Corporation. Its
shows that based on the above ratio analysis Dakila Trading Corporation are continuously growing,
profitable and stable financial structure for profitability, liquidity and solvency ratios results.