Financial Statement Analysis Project -- A Comparative Analysis of Oracle Corporation and Microsoft Corporation

Here is the link for the financial statements for Oracle Corporation for the fiscal year ending 2007. First, select 2007 using the drop-down arrow labeled for Year on the right-hand side of the page, and then select Annual Reports using the drop-down arrow labeled Filing Type on the left-hand side of the page.

You should select the 10k dated 6/29/2007 and choose to download in PDF, Word, or Excel format.

http://www.oracle.com/us/corporate/investor-relations/sec/index.html 

Here is the link for the financial statements for Microsoft Corporation for the fiscal year ending 2007. You should select the Annual report dated 8/3/2007 and choose to download in Word or Excel format.

http://www.microsoft.com/investor/SEC/default.aspx?year=2007

A sample Project template is available for download in Doc Sharing. The sample project compares the ratio performance of Tootsie Roll and Hershey using the 2007 financial statements of Tootsie Roll and Hershey provided in Appendix A and Appendix B of your textbook.

For Parts 1 and 2:

Create an Excel spreadsheet to show your computations for the six ratios listed under each part.

For Part 3:

Create an Excel spreadsheet to show your computations for the six ratios listed under this part and also to include (copy and paste) the ratio calculations from the first two parts.

Prepare a four-column worksheet in Excel, with the left-most column (column 1) to write the ratio names, the second column from the left (column 2) to show the calculation of each ratio for Oracle Corporation, the second column from the right (column 3) to show the calculation of each ratio for Microsoft Corporation, and the right-most column (column 4) to include your DETAILED comments about each ratio and what the ratio tells you about each company under study. Calculate each of the following six ratios.

1. Earnings per Share
2. Current Ratio
3. Gross Profit Rate
4. Profit Margin Ratio
5. Inventory Turnover Ratio
6. Days in Inventory (Average Age of Inventory)

Your spreadsheet will look like this:

Please upload your Excel file in the appropriate Dropbox according to the deadline shown in the syllabus. Unless you receive permission from the instructor to delay the submission, failure to turn in this part of the project by the due date may result in a significantly lower grade, including a grade of zero, for the part.

See Syllabus/"Due Dates for Assignments & Exams" for due date information.

Prepare a four-column worksheet in Excel, column 1 to write the ratio names, column 2 to show the calculation of each ratio for Oracle Corporation, column 3 to show the calculation of each ratio for Microsoft Corporation, and column 4 to include your DETAILED comments about each ratio and what the ratio tells you about each company under study.

 Calculate each of the following six ratios.

1. Receivable Turnover Ratio
2. Average Collection Period
3. Assets Turnover Ratio
4. Return on Assets Ratio 
5. Debt to Total Assets Ratio
6. Times Interest Earned Ratio

Please upload your Excel file in the appropriate Dropbox according to the deadline shown in the syllabus. Unless you receive permission from the instructor to delay the submission, failure to turn in this part of the project by the due date may result in a significantly lower grade, including a grade of zero, for the part.

See Syllabus/"Due Dates for Assignments & Exams" for due date information.

Part 3

Prepare a four-column worksheet in Excel, column 1 to write the ratio names, column 2 to show the calculation of each ratio for Oracle Corporation, column 3 to show the calculation of each ratio for Microsoft Corporation, and column 4 to include your DETAILED comments about each ratio and what the ratio tells you about each company under study. Remember to copy and paste the ratio calculations and interpretations from the first two parts of the projectin this worksheet, in addition to calculating the following six ratios.

1. Payout ratio
2. Return on Common Stockholders' Equity Ratio
3. Free Cash Flow
4. Current Cash Debt Coverage ratio
5. Cash Debt Coverage ratio
6. Price/Earnings Ratio [For the purpose of this ratio, use the market price per share as of the last working day of the year 2007 for each company]