The financial position of Petas Kentucky Fried Cruelty Inc Campaign Financial Analysis can be evaluated by taking a look at its ratio analysis.
We can see in appendix 1 how the revenue has actually been decreasing for many years after 2005. The truth that the gross profit margin has decreased as well recommends that the cost of sales have actually not gone down at the exact same pace. The declining net success, showing an unfavorable trend from 2006 to 2007 suggests that expenditures have actually increased far more than the company is able to manage offered its present resources. With a long term debt adding to the interest expenditure, Petas Kentucky Fried Cruelty Inc Campaign Financial Analysis is in dire requirement of an alternative profits stream.
We can see a major declining pattern in the current ratio too revealing a fall in liquidity which is another point of concern for Petas Kentucky Fried Cruelty Inc Campaign Financial Analysis specifically as it has a long term debt to pay off too. With the current properties not in a position to pay off the existing liabilities, we can see how the business would remain in a significant financial problem unless the capital enhances with additional sources of financing.
We could check out the monetary condition of Petas Kentucky Fried Cruelty Inc Campaign Financial Analysis even more by taking a look at the company's overall financial obligation to total possessions ratio in appendix 2. We can see how the total assets of the company have been declining from 2005 onwards. However, the long term financial obligation has actually stayed at $160 million while the short-term debt has increased side by side. Such a situation has brought Petas Kentucky Fried Cruelty Inc Campaign Financial Analysis to a point where its overall debt to overall properties ratio has actually increased. A rising total debt to total possessions ratio suggests that the danger has actually increased in regards to the business's possessions not being enough to cover its total liabilities. This may not be revealing the general liquidity position but gives clearness in regards to the overall monetary position of the company.