Complete Financial Analysis Classmate Responses

Please cite any references used to reply to the following four discussion posts made by my classmates:


Church & Dwight is the manufacturer of products such as Arm & Hammer, Nair, Trojan Condoms, and Aim Toothpaste.  From a sales standpoint, Church & Dwight has trended relatively well.  The last three years, they have had minor increases in revenue.  Profits have also seen a steady rise, albeit minor. 

Cash flows, however have been less desirable.  While total cash flow from operating activities has increased year-over-year, negative cash flows for financing activities has caused negative cash flow changes since 2013.  Net borrowings was the most drastic change causing this issue.

Total assets have remained fairly consistent, although the loss of cash (as seen above) was noticeable.  Total liabilities have not changed much since 2013 either, and equate to about half of the company’s total assets. 

In conclusion with regards to the facts above, Dwight & Clark’s financial performance is pretty solid.  Sales has grown despite tough competition from Proctor & Gamble, and profits have increased as well.  While the improvement in performance brings optimism, you’d have to imagine stockholders and stakeholders would hope for more. 


I decided to go with Hershey after studying them in one of my last classes and well, I love chocolate!  

 (in thousands of dollars)


Working Capital


Working capital = Current Assets – Current Liabilities

Current Ratio


Current Ratio = Current assets/current liabilities

Debt to total assets ratio


Debt to total assets ratio = total liabilities/total assets

Free Cash Flow


Free Cash Flow = Cash Provided by Operations-capital expenditures-cash dividends

Earnings per share


Earnings per share = net income/average number of common shares outstanding during the year

Hershey has very healthy working capital on hand and are able to pay short term creditors.  Hershey is in a decent position and has good liquidity.  Hershey has very good short term positioning.

Comparing the debt to total assets ratio the debt load of both Hershey is high.  This brings into question their long term solvency but given the relative stable earnings over two years shows that the company will probably be around for the long haul. 

Hershey has decent cash flow, although maybe they should take some of their cash and pay down some of their long term liabilities to improve their overall solvency picture.

Earnings by shareholders are decent and the company appears to be a decent investment for long term gains.

A good article about Hershey can be found here:


1-B1 Solved for Yellow Boxes

Formula for Solution
Assets Beginning of period  $  6,579 assets = liabilities + paid in capital +retained earnings
Assets End of period  $  7,028 assets = liabilities + paid in capital +retained earnings
Liabilities beginning of period  $  5,007 assets – paid in capital – retained earnings = liabilities
Liabilities end of period  $  5,441 assets – paid in capital – retained earnings = liabilities
Paid in capital, beginning of period  $  1,066 paid in capital =assets-liabilities-retained earnings
Paid in capital, end of period  $  734 paid in capital =assets-liabilities-retained earnings
Retained earnings beginning of period  $  506 retained earnings=-liabiliites-paid is capital+assets
Retained earnings end of period  $  853 Retained earning end of period=retained earnings of beginning of the period+net income-dividends
Revenues  $  9,700
Costs and expenses  $  9,087 Costs and expenses = revenues-net income
Net income  $  613
Dividends  $  266
Additional Investments by stockholders  $  102



                Cash Sales                                      SEK 190,000,000

                Collections from Credit Customers             300,000,000

    Total Revenue                                              SEK 490,000,000

Using the accrual method gives you a more accurate account of what your revenues are in regards the the current inventory utilized. In regards to logistics, if goods are delivered three to four weeks after the transaction it would show that the next month’s revenue of zero. The cash basis doesn’t give an accurate snapshot of the transaction. 


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