Financial Statement Analysis Essay Example | Topics and Well Written Essays - 1250 words - 1

Financial Statement Analysis - Essay ExampleThe companys taxation was up and down during period. A clearer moving-picture show of these changes is provided in the charts labelled image 1.The information in Figure 1 shows that Dixon sell experience higher levels of turnover in nominal terms than collection plate retail during the five year period. The trend was similar up to 2012. However, Home retails revenue continue to decline in 2013 while Dixon Retails Revenue enlarged. When the figures are adjusted for inflation the picture is somewhat different. (See Table 2 in the Appendix.) Figure 2 illustrates the trend for both companies in objective terms.The information in Figure 2 shows similar trends for both companies for both companies over the first tetrad years a slight decline in revenue in real terms amongst 2009 and 2010 a significant decline between 2010 and 2011 and a moderate decline and increase between 2012 and 2013 for Home Retail and Dixon Retail respectively.A c ompanies greet of gross sales is the cost of raw materials and other costs essential to get the goods to the customer. The common size cost of sales for Home Retail group shows a incessant increase from 65.69% of turnover in 2009 to 68.37 in 2013. This is an indication of rising costs of goods without a similar increase in price. The information for Dixon Retail was somewhat different as the common size cost of sales ranged from 92.48% to 94.86%. These two percentages were recorded in 2012 and 2013 respectively. Figure 3 shows the information for both companies.Figure 3 shows a bar graph of common size costs. The graph shows that the common size costs for Home Retail showed an upward trend while that for Dixon Retail remained fairly stable with an obvious slight decline in 2010.A companys gross profit represents the difference between its sales revenue (turnover) and its cost of sales. The gross profit as a percentage of sales was much higher for Home Retail above 30% than for