High Performance Tire Report

Prepared By: Group Name

Individual Name, ID

Individual Name, ID

Individual Name, ID

Submitted To: Recipient Name

Submission Date:
 Executive Summary

Prepare an executive summary for your report. Don’t forget that your executive summary has to
summarize the issue and your recommendations. It should not be more than half a page for this small
case.
Table of Contents

Prepare a table of content for your report on this page

Introduction:

Here you should briefly describe the purpose and scope of the report. (This is why your report was
written and what the reader will find inside)

Qualitative & Quantitative analysis

1. Profitability

Use financial ratios & trend analysis in describing the profitability of HPT across time. Indicate whether
HPT is doing better or worse since William Wallace took over.

2. Liquidity

Use financial ratios & trend analysis the liquidity of HPT. Try and compare with the industry average.
Indicate whether HPT is doing better or worse than the industry. You can also compare HPT across time
(Horizontal or trend analysis)

3. Asset Management

Use ratio analysis in describing how the business assets are managed. Try and compare with the
industry average. Indicate whether HPT is doing better or worse than the industry

4. Long Term Debt

Use ratio analysis & trends in describing HPT’s debt situation. Compare with the industry average.
Indicate whether HPT is doing better or worse than the industry
Recommendation

Make recommendations on what should be done in the longer term in regard to the management of the
business.

Conclusion

Provide Closure to the report by summarizing what the report has accomplished and reinforced your
recommendation.
 Appendices

Formulas for

FINANCIAL RATIOS

LIQUIDITY

CURRENT ASSETS
CURRENTRATIO
CURRENT LIABILITIES

CURRENT ASSETS - INVENTORIE S - PREPAID EXPENSES

QUICK R
ATIO CURRENT LIABILITIES

CASH  MARKETABLE SECURITIES

CASH RATIO
 CURRENT LIABILITIES

NWC CURRENT ASSETS - CURRENT LIABILITIES

NWC
NWCTO TOTAL
ASSETS TOTAL ASSETS
 Exhibit (continued)

ASSET MANAGEMENT

NET CREDIT SALES

A/RTURNOVER
AVERAGE ACCOUNTS RECEIVABLE

365
A/R TURNOVER IN DAYS
 A/R TURNOVER

COST OF GOODS SOLD

INVENTORYTURNOVE
R AVERAGE INVENTORIES

365
INVENTORYTURNOVER IN
DAYS INVENTORY TURNOVER

OPERATING CYCLE  INVENTORY TURNOVER IN A/R TURNOVER IN DAYS

DAYS

COST OF GOODS SOLD

A/
PTURNOVER AVERAGE ACCOUNTS
PAYABLE
365
A/PTURNOVER IN
DAYS A/P TURNOVER

CASH CONVERSION CYCLE  INVENTORY TURNOVER IN DAYS - A/P TURNOVER IN DAYS

 A/R TURNOVER IN DAYS
NET SALES
NWCTURNOVE
R AVERAGE NET WORKING CAPITAL
NET SALES
FIXEDASSETS
TURNOVER AVERAGE CAPITAL ASSETS

NET SALES
TOTAL ASSETS TURNOVER 
AVERAGE TOTAL ASSETS
 Exhibit (continued)

LONG-TERM DEBT PAYING ABILITY

Leverage Ratios

TOTAL LIABILITIES
DEBTRATI
O TOTAL ASSETS
LT LIABILITIES
LT DEBT TO TOTAL CAPITALIZA TION
 LT LIABILITIES  EQUITY

DEBT/EQUITY TOTAL LIABILITI ES

RATIO
TOTAL EQUITY

Coverage Ratios

EBIT
TIMESINTEREST
EARNED INTEREST EXPENSE

EBIT  LEASE EXPENSE  DEPRECIATI ON

CASH FLOW COVERAGE
 LEASE EXPENSE  INTEREST EXPENSE  PREFERRED DIVIDENDS / (1  t)
PRINCIPAL PAYMENTS / (1  t)

INTEREST EXPENSE
EFFECTIVE INTEREST RATE
 TOTAL INTEREST  BEARING DEBT
 Exhibit (continued)

PROFITABILITY

In Relation to Sales

PROFIT
GROSS PROFIT MARGIN GROSS
 NET SALES

OPERATING
PROFIT MARGIN OPERATING INCOME
 NET SALES
INCOME
NET PROFIT MARGIN NET
 NET SALES

In Relation to Investment

EBIT
OPERATING INCOME RETURN ON INVESTMENT 
AVERAGE TOTAL ASSETS
NET INCOME  I (1 - t)
RETURN ON ASSETS 
AVERAGE TOTAL ASSETS

NET INCOME
RETURNON
EQUITY AVERAGE TOTAL EQUITY