Albertson's V Kroger's

Ratio Comparisons: Albertsons Versus Kroger Company Albertsons 2-Year Comparison Ratios are consequential tools to be used when analyzing a companys financial health. There are four categories of proportions that are broken follow through into thirteen symmetrys. Eight symmetrys will be used to essay the financial statements of Albertsons for the years 2003 and 2004. The first category of ratio analysis is the liquidity ratio. In this category, we have figure the rate of flow ratio. The current ratio for Albertsons for 2003 is 1.2 and for 2004 is 1.05. Companies that have a ratio at or below 1.0 should be concerned, unless they have armoury that can be quickly converted to interchange. www.beginnersinvest.about.com . In the theme of Albertsons, this would be expected. This is also proven with the quick or acid-test ratio. For 2003, the ratio is .36 and or 2004 is .28. The Quick Test ratio does not utilise to the handful of companies where inventory is almost immediately convertible into cash (such as McDonalds, Wal-Mart, etc.). www.beginnersinvest.about.com. The second category of ratios is the asset utilization ratios. In this category, we have calculated the total asset turnover. For the year 2003, the ratio is 1.93 and for 2004 the ratio is 2.18.

The higher the ratio, the better assets are being utilized. For both dollar in assets Albertsons owns, the company sold $2.18 in goods. On the other hand, the higher the turnover rate, the lower the salary margin. www.beginnersinvest.about.com. In an industry such as Albertsons, the next ratio, the intermediate collection period is expected to be low. Most of its barter is in cash, so it is no surprise that for 2003 the average geezerhood for collections was seven and for 2004, it decreased to six days. One would think that the majority of this would be in the form of returned checks. This ratio should make heed pleased with the result. Another asset utilization ratio calculated is inventory turnover. For... If you want to get a full essay, rules of order it on our website: Orderessay

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