The financial statement of a business provides details of a company and if they are successful or if they are failing financially. The calculation of financial rations is use to determine the numbers and percentages that can affect the business profitability. The following financial ratio analysis will describes the financial status of CTAS, Cintas Corporation based on three years financial statements. Financial ratios indicate the company’s performance and financial status. The financial department use different types of formulas to obtain the information needed. In the case of Cintas Corporation, the financial ratio analysis indicates the company had a significant increase on their total revenue, cost of revenue, and gross profit in the period of three years. The information is provided under the financial statements. The financial ratio typically analyzes trends and compares the company’s performance compared to other companies in the same industry.
The financial ratio can be classified based on its information and frequency of use ( NetMBA, 2015).
Cintas income statement indicates the company has been growing significantly in the past three years. Based on the data in the financial stamen the company has an increase of 18.33% on total sales and 44.61% increase on net income growth. The company had a little decrease on numbers in the year of 2013 when the companies only increase their net income by 6.11% (NASDAQ, 2015).
The Business plan on Wal Mart Capital Company Ratio
... for improvement. An analysis of the financial ratios for the company over the last three years as well as an industry comparison ... tax cost of borrowing. Wal-Mart! |s overall financial statements appear to be positive indicating an organization that should ... strengthen it asset turnover ratio. Positive customer relations, which would lead to increased sales, would increase the ratio. Since there are ...
There are three types of calculations use in order to calculate Cintas positioning in the market. These calculations provide the accurate information if the company is meeting their short-term financial obligations. From 2012 to 2014, the company had an increase of 22% on their current ratio. In the case of this company the information is: Financial ratios
Conclusion
The company meets the profitability ratio proven by the success of the company generating profit. Cintas typically has a 100% ratio of margin in any service provided. The company meets successfully the financial ratio requirements in order to be profitable and successful in the market.
References
NetMBA , Business Knowledge Canter, 2015, retrieved from http://www.netmba.com/finance/financial/ratios/ Yahoo Finance, retrieved from http://www.nasdaq.com/symbol/ctas/financials?query=balance-sheet
